The Association of Payment Clearing Services (Apacs) has arrived at a UK standard for an authentication device for cardholder-not-present credit and debit card transactions, conducted online or over the phone.
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Apacs said the standard would allow banks to start working in earnest on developing interoperable card readers for consumer use. The readers work by generating a unique authentication code for a transaction when a card is used.
The technical specifications for the standard, which took nearly four years to agree, will use chip-and-Pin cards and will require changes to banks' back-end systems.
The first readers are not expected to be ready for at least a year, though some banks, including Barclays, are already in the development phase.
Apacs said developing the standard had taken so long because of the complexity in keeping up with changing global standards and the need to consult with all interested parties.
Tracking developments in patterns and types of fraudulent activity had also posed a challenge, an Apacs representative said.
"It is now up to the banks to pick up the baton and develop these universal readers for the commercial market," she added.