MasterCard and Visa agree smartcard standard
- Posted:
- 11:00 15 Mar 2005
- Topics:
- Security | e-commerce & e-business | Folksonomies & Tagging
MasterCard and Visa have agreed a technical standard for
contactless payments in a move aimed to speed up adoption of
smartcard technology.
The technical standard will ensure that point of sale terminals
will be able to process payments from the new breed of cards that
use embedded chips and radio frequency identification tagging
technology to authorise payments.
Cardholders authorise a payment by waving their card near the
terminal.
MasterCard and Visa have already agreed an international technical
standard for chip and Pin cards, called EMV.
Andy Kellett, senior research analyst at Butler Group, welcomed the
technical standard. "The fact that these two organisations are
coming together is not just common sense, it is absolutely
essential," he said.
Art Kranzley, chief e-business officer and executive vice-president
of advanced payments at MasterCard, said, "Agreeing one common
standard benefits all in the value chain. Merchants and terminal
suppliers can invest and deploy contactless devices with
confidence, knowing they will have to develop and support one
communications specification, making the manufacturing process
easier and less costly."
In a report published last week, professional services firm
Deloitte said advances in smartcard technology and falling unit
costs had removed any remaining barriers to adoption.
"Consumers are much more attuned to the idea that a tiny chip
incorporated on a card, or within an everyday device such as a
phone, could be used to store money and pay for a daily paper, a
cup of coffee or a bus fare," said the report.
It added that widespread consumer use of smartcards would depend on
making them easy to use, getting backing from retailers and working
out a profitable business model.