Day one at Cartes, including an interesting and lively panel debate at this year’s World Card Summit. Key topic areas on the agenda for discussion were – ‘opportunities and threats for digital secure industry’, ‘the impact of biometrics’, and ‘cloud security and mobility’. Perhaps unsurprisingly in today’s connected world, the common thread throughout all these items was mobile.
The extraordinary explosion in smart device ownership has led to ‘mobile’ often being cited as a major threat to the incumbent card players and payment model. As @PierrerMetivier tweeted during the session – “it will not be a world card summit if we did not talk about NFC”. Building on this, it’s fair to say that it wouldn’t be a discussion about mobile use in payment if we don’t touch on mPOS – mobile point-of-sale.
mPOS technology has gained significant momentum over the last year, and continues to do so. It not only offers micro merchants the well-documented ability to accept card payments securely via a mobile device, but crucially opens up a whole new market for Payment Service Providers (PSPs).
This technology represents the confluence of mobile and traditional card, with far fewer barriers to mass adoption than NFC is facing. The most significant of these, is that the encryption technology used to secure mPOS transactions is already proven, alongside robust and developed standards. Another of these is flexibility for the merchant – currently, mobile devices cannot be certified under PCI or EMVCo, only the card scheme apps that must run within the Secure Element of the phone. This locked down mobile device does not allow for customisation of the customer interface. With mPOS, data is encrypted at point-of-capture, the card reader, eliminating the merchant device from the security scenario, and subsequently permitting the addition of value-add features.
There can be no doubt that the mPOS revolution is helping the industry to maximise the use of payment cards, though to see the real opportunity in this market, we have to move beyond the tried and tested ‘cards versus mobile’ argument. These technologies are complementary, not competitive.