A major issue is where valuable data regarding the consumer's identity, linked card details and transactions will be securely stored
As the development of digital wallets – applications and services that allow the use of smartphones for contactless payments and direct transactions – brings banks, organizations, telecommunications providers and device manufacturers to the same table, on the topic of adopting common specifications that will allow the creation of a single ecosystem, the subject of discussion is where the valuable data regarding the consumer's identity, the details of the linked cards and the transactions will be securely stored.
To date, the platforms being tested around the world are based on:
– Either the model of parallel use of the mobile phone SIM card, which functions to connect to the network and can be used to store digital wallet data, such as the embedded EMV chip in credit, debit and prepaid cards - a solution supported by telecommunications providers, since it essentially keeps them in the game.
– Either in the use of a different element (chip) of the mobile device – from the rest of the processing system, a proposal presented last year at the Mobile World Congress in Barcelona by Visa in collaboration with Samsung.
Now, according to finextra.com, Visa and Mastercard are expressing their support for a third solution, which is located in the Cloud. Host Card Emulation is a mechanism for hosting valuable data outside the device, reducing banks' dependence on telecommunications providers. Through HCE, any NFC application installed on an Android device emulates a smart card, enabling users to pay with their smartphones, while allowing financial institutions to host payment data in a secure Cloud environment.
“Both Visa and MasterCard have announced a new set of support tools and applications to make it easier for banks to adopt HCE as an alternative to renting space on the SIM card. This revolutionary development is a challenge for telecommunications operators, who will be forced to redefine their relationships with banks and invest in value-added services to attract their support,” the finextra.com report states.
Source: protothema.gr
