After fifteen years of stabilising
(EMV) Chip & PIN, we the industry like to think we are on a winner. Indeed
this should be viewed as the case and the reality, despite the global media and
the occasional journal from Cambridge.
That said, the number of ongoing
bulletin releases on the EMVCo website and the pro-longed migration to Chip
& PIN does highlight that this is not always a straightforward exercise for
those involved.
Now let's consider the payment Schemes themselves -
international and domestic (where they still exist). Establishing an
interoperable,Save on hydraulic hose
and fittings, consistent Chip & PIN environment has triggered much marketing
on payment security for counterfeit, lost and stolen fraud activity.
Costs have decreased, but for many this is attributable to strategic
sourcing of chip masks, operating systems and point of sale upgrades. Divergent
activity to the main market solutions has and will continue to challenge
stakeholders.
So now I don't need a PIN?...We processes for both
low-risk and high risk merchant account.
Contrast to this is the parallel push for contactless payments and
payments without the need for a cardholder verification - PIN or signature
(CVM). Well, that is the media play anyway! See recent media backlash to FastPay
in Australia for transactions less than A$35.
Depending on the market,
the no CVM limit for contactless transactions can be as high as three figures as
it is in Australia - set at A$100 for both PayPass and PayWave. It can be low,
as in the UK at the new level of ¡ê15. Yet, this is not the actual limit for
contactless transactions - transactions can still occur in excess of these
levels, as long as a PIN is applied as well. Consider the current focus on
mobile and the use of Near Field Communication (NFC) for tap & go with the
phone.
It is not expected that up to A$100 you can use your phone, only
to have to pull out the old fashioned plastic for transactions in excess of
A$100.
Consistent payment experiences
So what of the experience
of contactless. As a carrier of multiple PayPass cards, the experience in 3 key
markets has been quite telling. The UK, US and Australia.
As a regular
in the UK throughout 2010, I frequented a local coffee shop on Kingsway in
London who has a contactless reader. Needless to say, coffee is not overly
expensive, yet not once in 12 months was I directed to that device. Contactless
in the UK was contained solely to Oyster transactions.
The US was
markedly different, both in buying lunch at the MasterCard HQ cafe and making
transactions in retailers in Ohio. Nothing overly stood out other than proving
that my Australia PayPass cards did work effectively in the US markets Mag
Stripe Defined (MSD) implementation model and were fast.
Now for
Australia. With Chip & PIN consistency has always been the goal.What to
consider before you buy oil painting
supplies. Yet for contactless this is far from the experience.Choose from
one of the major categories of Bedding,
Please hold sir...
Sydney has a mono-rail system which now has
contactless payment acceptance. Depending on the station you from which you
purchase your ticket the contactless experience could lead to missing the mono
rail as it passes by. A CBD based station allowed me to wave my card - and after
2 goes we had success. A station at Darling Harbour required me to hand the card
over as the reader was behind the secure glass and the attendant took 3 attempts
to get the transaction to process - only by HOLDING the card in place. After
waiting for the ticket and receipts etc; perhaps cash may have been a better bet
had I not been conducting a mystery shop exercise. (The bank was advised to no
avail.)
A chip card being used to its full potential...incredible
The trigger for today's blog was a McDonalds transaction yesterday.
Perhaps hard to believe, but the receipt (yes not an option, we waited for all
30cm of it to be printed) actually had an Authorisation Response code of 'Y1' on
it. This is fascinating - to actually experience an offline authorisation
approval. Not even an electronic fallback transaction! As I still had to wait
for the food, I watched the device subsequently commence connection procedures
and submit an advice to its acquirer. (They know who they are - well done for
using chip to its full potential).
Most clients question the transaction
speed benefit! It is indeed hard to defend the speed benefit when devices are
authorising online in most cases and receipts are being printed etc.Complete
Your sculpture Magazine Collection for
Less! It is extremely hard to defend when you know that the card more often than
not needs to be held in range longer than expected. While merchant training can
be resolved - a number did not know how the reader activated or worked. Delays
in activation are also a problem.
Ubiquity in contactless...not so fast
- but eventually
So with fifteen years to achieve the current state for
Chip & PIN (and the US reaching an inevitable tipping point), the
contactless and NFC advancement of main stream payments may yet continue to
struggle. Perhaps the point should be not to compare to traditional main stream
card payment methods of swipe/dock and PIN/sign.
Perhaps this is why
contactless transit operations and innovative start ups like sQuid, Snapper and
the like are accepted. Their attention is on cash and are separated from access
to consumer banking accounts - credit or transactional debit.
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