A Journey through Mobile Payment from the Technology and Business Perspectives

LU Chenglong (1010161750)DIAO Wenrui (1010089510)

ELCT 5820 Distributed and Mobile Systems

OutlinePart I: IntroductionPart II: General frameworkPart III: System platformsPart IV: Security issuesPart V: Business models

Introduction The payment for goods and services using a mobile device Alternative payment method to cash and credit cards

Current situation Widely deployed in many regions of Asia and Europe Around 100 million active users in the world

Participators of Mobile Payment

Customer -mobile phone user

Merchant -provides goods or services

Payment Service Provider - responsible for the payment process

Trusted Third Party -provides the service certificate

General frameworkA simple conceptual model with four major participators

Platforms Based on Different Channels•Short Message Service (SMS)

Platforms Based on Different Channels•Unstructured Supplementary Services Date (USSD)

Platforms Based on Different Channels•GPRS/UMTS

Platforms Based on ApplicationsPlatforms Based on Applications•Phone-based Application

Platforms Based on Applications•SIM-based Application

Platforms Based on NFC•Near Field Communication

Five Aspects of Security for M-Payment

Confidentiality -Transmission data encryption

Authentication -Possession, knowledge and property

Integrity -Digital signatures

Authorization -Digital certificates

Non-repudiation -Digital signatures

Security Challenges

Security of Mobile DevicesSecurity of Network Technologies

Security of Service -SMS

-USSD-Voice-based

Standardization

Business model: Operator-Centric Model

Mobile network operator deploys mobile payment service independently

Lack of connection with existing payment networks

Business model: Bank-Centric Model

Bank responsible for deploymentPayments processed through existing financial networksClear value chain, easy to implementTransaction fees charged only by the banks

Business model: Peer-to-Peer Model

Independent peer-to-peer service provider Revenue from transaction fees and licensing fees Not utilizing existing banking networks Insufficient customer base, lack of established brand and infrastructure

Business model: Collaboration Model

Collaboration among different stakeholders Third party Trusted Service Manager Most feasible: each stakeholder focus on own core competency Dispute about the revenue sharing model