Mobile Payment Systems

8/4/2019 Mobile Payment Systems

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Overview of Mobile

Payment SystemsAmit Naik

BMC Software


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Agenda

Why should we care?Mobile Payment types

World of NFC

NFC Payment Networks

Start-ups in Mobile Payments space

Wrap-upQ&A


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Why should we care?

Lot of money in this space

Mobile Payments To Triple To $670 BillionBy 2015 Report by Juniper Research

141 Million people spending $86.1 BillionUsing Mobile Payments - Gartner 2011

Paypal alone seeing $3 Billion Using MobilePayments in 2011 Paypal blog

"And one more thing..."


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iPhone 5 rumored to have NFC!

Are you willing tobet against Appledisrupting the

mobile paymentsspace?

Just like:

- Music (iPod)- Phones (iPhone)- Tablets (iPad)


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Is it safe?

PIN protectedSafer than Cash

Lost SmartPhone

noticed in 15 mins,Lost Wallet 60 minson avg.!

Info Encryptedwhile on Phone


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Mobile Payment Types


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Types of Mobile Payments

Interactive Voice Response (IVR) basedApplies to Landline and Mobiles

Premium SMS based

Direct Billing Customer Identity based

Web Payments

Contactless (NFC)Point-of-Sale

Peer-to-Peer


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Mobile Payment types contd

Direct Billing and Contactless modes ofmobile payment seeing faster adoption

Direct Carrier Billing examples: Zong

(Paypal) , BilltoMobile, Boku, MoPay,Billing Revolution, etc.

NFC leads in contactless payments tech.

Juniper Research: 1 in 6 users worldwidewill have an NFC-enabled phone by 2014


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World of NFC


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Overview of NFC - Origins

Near Field Communications (NFC) is aform of Radio Frequency ID (RFID)communication

Invented by NXP Semiconductors(Philips) & Sony in 2002

Near Field (less than 0.10 meters)

typically not more than a few centimeters

Enhanced Security and lower power needs


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NFC Overview 3 operation ModesCard Emulation

Enables devices to act like contactless cards

NFC-enabled mobile phones used for payment

Reader/ Writer

Enables devices to interact with RF tags

E.g. NFC-enabled phones used to read smartposters

Peer-to-Peer

Enables devices to communicate with one another

E.g. NFC-enabled laptops and printers


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NFC Overview - Technology


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NFC ready smart phonesBlackBerry Bold Touch 9900/9930

Samsung Galaxy S II (select phones)

Nokia C7-00 (Symbian) aka

T-Mobile AstoundHTC Incredible S with NFC chip (China)

Nokia has numerous non-smart phones

with NFC for a while in the market

iPhone 5?


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NFC Software Stack

Open NFC is a open source software stackwith Hardware Abstraction Layer

Multiple bindings available for different

devices Open NFC for Android,

WinCE/Mobile Edition,

Linux Edition (for embedded Linux or Linux for PC),

PC Edition (for Windows XP/Vista/7), and

Core Edition for small OS (Nucleus, REX...)


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NFC Payment Networks


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Google Wallet


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How Does Google Wallet Work?

Android App Stores your plastic detailsCredit card numbers, Name, Expiry, etc

Point-of-Sale (PoS) equipped with NFC

Contactless Readers (PayPass)App. transfers Credit Card authorization

using NFC chip on Mobile device

Compatible with Nexus S/Nexus S 4G today

Citi MasterCard and Google Card used


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Google Wallet Security layers

Credit card info stored in encrypted formSecure Element - Separate Chip on phone

Its own memory isolated from phone memory

Restricted access by trusted apps only

PIN reqd. to activate phones NFC antenna turned off after each info. exchange

Device must be in close proximity reader


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Wallet Security Layers Contd

NFC transceiver is only enabled when thephones screen is illuminated

PIN is a must to authorize payment

transfers in form of Secure CredentialsCredentials transferred directly using

Master Cards Paypass protocol

Wallet app prevents obvious weak PINlike 1234 , 1111 & Enforces lock out


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ISIS Payment Network

NFC based Payment NetworkAT&T, Verizon, & T-Mobile together

formed ISIS network

Supports VISA, MasterCard, AmericanExpress, and Discover

ISIS enabled Phones not on the market and

Architecture is not yet published

US trials starting 2012


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NFC Adoption Stats

Credit card companies worried about newentrants disrupting ecosystem

Chicken-and-Egg: People cant use NFC

no hardware manufactures do not makeNFC hardware as people do not use it

NFC to become widely deployed by 2014

Multiple Startups filling gap between FullNFC and Pure Old Credit Card (POCC)


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Startups - Mobile Payments Area


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Square - P-2-P mobile payments


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SMB and P-2-P mobile payments

Square Dongles allows merchants to useCell Phones/Tablets to swipe credit cards

Attachment fits into the audio jack of the

iPhone/iPad/Android deviceApp. on the phone then transmits info to

Squares servers and Charges the card

VISA recently made a strategic investment

Start-up Valued at around $1 Billion!


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Square Competitors

VeriFone Makes both NFC software andtraditional Credit card readers for iPhone

Reader Case wraps around the bottom-

half and plugs into the dock of iPhoneInnerFence is another company that

makes a similar card reader for

iPhone/iPads

Plugs into the dock of the iPhone/iPad


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FigCard WiFi based payments

Fig card (Paypal) provides an applicationfor Wifi enabled smart phones

Cheap USB dongle for Merchant POS

Fig card app stores Credit cards details

When customer is ready to pay, app onphone sends encrypted WiFi signal to POS

Phone number/ Credit card number etcnot exchanged Electronic confirmation


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Card.io Capture card info easier

App on phone takes apicture of Credit Card

Strips out reqd. info &

send it to MerchantDeletes picture from

phone once completed

API available forthird-party integration


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Jumio Similar to Card.io

Mobile app that takesa picture of Card

Scans picture and

extracts info.Also can useWebCam

at a POS terminal

Securely transmitsdata


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Naratte Zoosh Ultrasound Paymts

Data delivery byultrasound waves~20,000 Hz

Any phone that playsnormal mp3s will work

Regular Speakers and

Microphone capable ofsending and reception

Works securely even in

noisy environments


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Wrap-up: Future of Mobile Payments

Almost unlimited possibilities fordisruption of existing shopping experience

Low barrier to demo stage

Location aware offers Phone GPS + NFC

Verified check-ins Offers (FourSquare)

Personalized

Offers (Browsing history)

Instant in-store offers (Proximity based)


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Wrap-up contd

Instant coupons, instant offers (on-line)Receipts are electronically processed

Phone App. has a transaction log and

actual Receipt could be E-mailed/ScannedLots of innovation From SMS based

payments to NFC based payments in all

markets


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Q & A


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Get in touch!


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ReferencesJuniper Research Report: http://www.marketwire.com/press-release/mobile-

payments-market-almost-triple-value-2015-reaching-670bn-according-new-juniper-1534333.htm

Gartner 2011 mobile data: http://www.gartner.com/it/page.jsp?id=1749114

Paypal blog on mobile payments:

https://www.thepaypalblog.com/2011/06/paypal-doubles-mobile-payments-

predictions-to-3-billion-in-2011/

Steve Jobs Images by Albert Watson (Angry old Man) and National GeographicOctober 1982 - Moira Johnston/Charles ORear

NFC Technology Architecture: http://www.nfc-

forum.org/resources/presentations/

Open NFC: http://www.open-nfc.org/infos.html

Google Wallet: http://google.com/wallet


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References contdGoogle Wallet Security:

http://www.pcworld.com/article/228959/google_wallet_security_has_a_weakness.html

ISIS: http://www.paywithisis.com

Square: https://squareup.com/

VeriFone: http://www.verifone.com/InnerFence: http://www.innerfence.com/

FigCard: http://figcard.com/

Card.io: http://card.io

Jumio: https://pay.jumio.com/

Naratte: http://www.naratte.com/

Documents

Mobile Payment Systems