NFC payment security 'a game changer'

2014-06-12 14:41 - Duncan Alfreds
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Shopping. (Duncan Alfreds, News24)


Cape Town - Contact-less, cashless, mobile payment seems like an ideal way to transact, but given the fact that hackers target financial information, security for the platform is critical.

"Thanks to state of the art security, SIM based NFC mobile payment reuses the logical and physical security mechanisms used for contactless cards and brings additional security layers to comply with the need for post-issuance activation of an NFC payment application," Benjamin Binet, vice president of Gemalto Southern Africa told News24.

The company is actively pushing NFC or Near Field Communications as a mobile payment platform.

This technology is usually associated with smartphones, but Gemalto has developed a solution where an NFC sticker can turn any mobile phone into an NFC-enabled device.

However, payment applications require additional security as criminals are intent on using malware to steal personal and financial information.

Mobile technologies

"Payment applications require certification (such as the one coming from Visa and MasterCard). These payment applications are downloaded and installed in secure elements like SIM cards which have to be common criteria certified (exactly like banking cards)," said Binet.

NFC technology is already being employed in developed countries.

In Japan, some retailers have a programme where you pay for groceries simply by swiping your phone at the checkout. Absa conducted an NFC trial with its workers where payment with mobile phones could be concluded at ATMs.

The technology has also been employed in public transport systems where users simply wave a card to make the payment. Using the same technology with mobile phones seems to be the next logical step.

Mobile technology is likely to boost e-commerce as consumers migrate toward new technologies. (Duncan Alfreds, News24)

Mobile technologies are growing as more people use their mobile devices to transact.

Juniper Research reports that mobile e-commerce sales amounted to $1.5 trillion in 2013, and is projected to hit over $3.2 trillion by 2017.

As more people access internet services, it is likely that they will migrate to digital payment platforms and companies have to ensure that these platforms are available as consumers demand it.

Virtual products

Statista reports that digital shoppers in the US grew from 172 million in 2010 to 191 million in 2013, and is projected to reach 215 million by 2018.

In SA, the growth of online payments of virtual products has demonstrated that there is an appetite for online payments that is simple, yet secure to use.

"The NFC SIM cards storing a consumer's payment credentials and the payment applications are certified according to security standards defined by financial services authorities and are comparable to CHIP-N-PIN security. In addition to this, consumers can choose to authenticate transactions by entering a PIN code on the payment application," Binet said.

This means that the NFC stickers can be used like traditional bank cards and Binet argued that security was increased because the system allowed payments to be blocked remotely.

"Consumers can also request the PIN to be entered for all payments, even for small amounts – providing the end-user with complete control of protection features. Last but not least; secure over-the-air technology for remote management enables immediate remote blocking of the payment application."

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