April 11 Enhanced Payments using EMV MasterCard’s solutions.

April 11

Enhanced Payments using EMV

MasterCard’s solutions

27th January, 2006 © MasterCard International 2

Agenda

• What do the EMV specifications bring to the market place?

• Overview of MasterCard’s OneSmart Solutions

• Applicability to Local Councils


What is EMV ?

Structure for Multi Applications on Cards

Paym

ent

CARD

TERMINAL

DIALOGUE

Network

? ? ? ? ?

AID AID AID AID AID

AIDAIDAID

AID


What does it bring?

• Standard Infra Structure and Flexibility

– The terminals can have the identifiers implemented for the products the service provider want to offer

– The Card and Brand can be personalised for

– Acceptance in all or some channels (ATM/POS/Inernet..)

– Restricted to some Service Providers

– Behave as a Credit, Debit and/or Pre-Paid card

– Separate funding for special purposes

– Additional functionality such as loyalty or other


What is OneSmart?

• MasterCard OneSMART is a range of solutions which uses the chip as a platform to deliver value-add business

• Each of these solutions is targeted at extending the card business into the following areas

– Cardholders – different profiles

– Service Provider locations – POS, Internet, ATMs, other

– Transaction types – Credit, Debit or combination

• The existing suite of OneSMART solutions provides a solid base on which to build range of payment and non-payment solutions for local authority programs


Suite of OneSMART Solutions

• OneSMART Authentication – remote authentication

– Security & confidence generate more remote transactions

• OneSMART Web – personal data storage & form filling

– ‘Top of wallet’ behaviour leading to increased share

• OneSMART Retail – loyalty & stored preferences at POS

– Increased loyalty leading to increased volume and share

• OneSMART Pre-Authorised – zero overdraft risk cards

– New cardholders and new acceptance locations

• OneSMART PayPass – combining EMV with contactless

– Quick & easy contactless payments that can displace cash


2 Factor AuthenticationYou Have it already !

« I have my card »« I have my card »

« I trust my card »« I trust my card »

« I know my PIN »« I know my PIN »


Use it for all Remote Services !

Channels & ServicesChannels & Services

Mail Order,

Telephone Order,

e-banking,

e-commerce,

Tomorrow’s

Services


OneSmart Authentication in Europe

GreeceTurkey

Israël

Bulgaria

France

UK

Czech Rep.SlovakiaSwitzerland.

Germany

Spain Italy

Austria Hungary

Sweden

Finland

Denmark RussiaIreland

Nederland

Norway

Estonia

Latvia

Croatia

Ukraine

Slovenia

Lithuania

Iceland

Portugal

PolandKhazakhstan

Romania

AzerbaidjanGeorgia

Belarus

Luxembourg

Belgium


OneSMART Web

• Security, convenience and automation in one package

Internet/Intranet

Credit cards, personal ID, etc.

Passwords & notes

Account information

Coupons

Web Services

Billing & shipping data

Logons, favorites,contacts, etc.

Security & Automation! . . . Life is

good!


New Opportunities for Customized Offers

OneSMART Retail

Bank

2- Card used for Payment, Loyalty and ‘On-the-Spot’ Offers

1- Card issued with Personal Preferences or Hobbies stored in MODS application

3- Information Printed on Receipt

Payment Information

Cardholder Preference &

Loyalty Points Balance

Customized Offer

according to Preference


OneSMART Pre-Authorized

• Funds set aside for fully controlled off-line spendingFunds set aside for fully controlled off-line spending

• Can be set up so the card holder perceives it as a Can be set up so the card holder perceives it as a “Purse”“Purse”

• Automatic or manual top-upAutomatic or manual top-up

• Fully supported by the standard EMV infrastructureFully supported by the standard EMV infrastructure

• Perfect for Low Value PaymentsPerfect for Low Value Payments

• Perfect for Contact Less PaymentsPerfect for Contact Less Payments

• Brings banking to the unbankedBrings banking to the unbanked


OneSMART PayPass overview

•MasterCard’s contactless payment solution

•Extends market for MasterCard payments

•Combines power of chip with convenience of contactless

•Designed for rapid, convenient proximity payments (eg fast food; mass transit; tollways)


OneSMART PayPass overview

•Uses the EMV chip infrastructure•Contact and contactless payment

functionality can be combined on single card

•Focus is on low value payments•Cash replacement•Successful trials in US although not

EMV based today


OneSMART Transit overview

• Combines:– OneSmart PayPass for fast, convenient

contactless payments– OneSmart Pre-Authorised for safe, low

cost, mass market issuance– A ticketing application which can either

be:– MasterCard EMV application, or– Proprietary application such as MiFare

• Extends market to previously cash-based transport applications

• Uses the EMV chip infrastructure• Can be configured to support all common

transport payment and ticketing requirements

MasterCard’s open solution for transport ticketing applications


Bus/Ticket validator(Contactless)

OneSmart Acceptance Infrastructure

Top Up at POS

(Contact EMV)

Payment at POS(Contact/Contactless)

Also potential for:•Branch network•Internet Home PC•Kiosk•Local authority facilities

CashCash


Key Requirements for e-Money

• Provide multiple application, card based prepaid/stored value products

• Reach all segments of a population

• Conventional payments – POS and ATMs;

• Local authority service and benefits.

• Interoperable “e-purse” scheme


Key Requirements for e-Money cont….

• Load by individuals; service providers, banks, local authorities, etc.

• Load and reload monetary value or benefits remotely or through other means

• Broad and uniform acceptance – at merchants, ATMs, transit, and all local authority facilities


MasterCard’s approach to e-Money Solution

• Make use of the EMV infra structure and OneSmart facilities

– Retail Purchases at POS

– ATM withdrawals

– Storing and using local authority specifics

– Transportation ticketing

– Restrictions (age, profile, merchants or other)

And / Or

– Universal acceptance


Potential Prepaid Applications for e-Money

Restricted acceptance (1)

Broader Acceptance (2)

•Luncheon•Transportation tickets

• Local Authority Rewards •Housing benefits

•Job seeker allowance

•Pension•Child tax credit•Payroll•Travel•Money transfer•Per diem•Insurance

• Restricted acceptance by geography, product type, group of merchants, type of terminals (e.g. POS only, internet only)

• Broader Acceptance = international acceptance and inter-operability


Components of e-Money Solution

Component MCI Notes

Cards EMV technology. MasterCard or proprietary branding

Terminals EMV technology. MasterCard or proprietary branding

Card applications EMV credit or debit payment plus OneSmart added value packages

Network MasterCard global network

Clearing and settlement

MasterCard services, eg Maestro (formerly Switch)

Business models Scheme rules, modified as necessary

Business partners MasterCard bank members

Implementation As required


For further questions

[email protected]

April 11 Enhanced Payments using EMV MasterCard’s solutions.

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