Overview of Mobile Payment Systems

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Overview of the Different Mobile Payment systems …

Overview of the Different Mobile Payment systems

- NFC based Platforms such as Google Wallet and ISIS
- Systems like Square, VeriFone, Card.io Naratte Zoosh and other exciting and disruptive startups in this space.

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  • 1. Overview of Mobile Payment Systems Amit Naik BMC Software
  • 2. Agenda
    • Why should we care?
    • Mobile Payment types
    • World of NFC
    • NFC Payment Platforms
    • Start-ups in Mobile Payments space
    • Wrap-up
    • Q&A
  • 3. Why should we care?
    • Lot of money in this space
    • Mobile Payments To Triple To $670 Billion By 2015 – Report by Juniper Research
    • 141 Million people spending $86.1 Billion Using Mobile Payments - Gartner 2011
    • Paypal alone seeing $ 3 Billion Using Mobile Payments in 2011 – Paypal blog
    • "And one more thing..."
  • 4.  
  • 5.  
  • 6. iPhone 5 rumored to have NFC! Are you willing to bet against Apple disrupting the mobile payments space? Just like: - Music (iPod) - Phones (iPhone) - Tablets (iPad)
  • 7. Is it safe?
    • PIN protected
    • Safer than Cash
    • Lost SmartPhone noticed in 15 mins, Lost Wallet 60 mins on avg.!
    • Info Encrypted while on Phone
  • 8. Mobile Payment Types
  • 9. Types of Mobile Payments
    • Interactive Voice Response (IVR) based
      • Applies to Landline and Mobiles
    • Premium SMS based
    • Direct Billing – Customer Identity based
    • Web Payments
    • Contactless (NFC)
      • Point-of-Sale
      • Peer-to-Peer
  • 10. Mobile Payment types – cont’d
    • Direct Billing and Contactless modes of mobile payment seeing faster adoption
    • Direct Carrier Billing examples: Zong (Paypal) , BilltoMobile, Boku, MoPay, Billing Revolution, etc.
    • NFC leads in contactless payments tech.
    • Juniper Research: 1 in 6 users worldwide will have an NFC-enabled phone by 2014
  • 11.
    • World of NFC
  • 12. Overview of NFC - Origins
    • Near Field Communications (NFC) is a form of Radio Frequency ID (RFID) communication
    • Invented by NXP Semiconductors (Philips) & Sony in 2002
    • “ Near Field” (less than 0.10 meters) typically not more than a few centimeters
    • Enhanced Security and lower power needs
  • 13. NFC Overview – 3 operation Modes
    • Card Emulation
      • Enables devices to act like contactless cards
      • NFC-enabled mobile phones used for payment
    • Reader/ Writer
      • Enables devices to interact with RF tags
      • E.g. NFC-enabled phones used to read “smart posters”
    • Peer-to-Peer
      • Enables devices to communicate with one another
      • E.g. NFC-enabled laptops and printers
  • 14. NFC Overview - Technology
  • 15. NFC ready smart phones
    • BlackBerry Bold Touch 9900/9930
    • Samsung Galaxy S II (select phones)
    • Nokia C7-00 (Symbian) aka T-Mobile Astound
    • HTC Incredible S with NFC chip (China)
    • Nokia has numerous non-smart phones with NFC for a while in the market
    • iPhone 5?
  • 16. NFC Software Stack
    • Open NFC is a open source software stack with Hardware Abstraction Layer
    • Multiple bindings available for different devices
      • Open NFC for Android™
      • WinCE/Mobile Edition
      • Linux Edition (for embedded Linux or Linux for PC)
      • PC Edition (for Windows XP/Vista/7)
      • Core Edition for small OS (Nucleus, REX...)
  • 17.  
  • 18.
    • NFC Payment Platforms
  • 19. Google Wallet
  • 20. How Does Google Wallet Work?
    • Android App – Stores your “plastic” details Credit card numbers, Name, Expiry, etc
    • Point-of-Sale (PoS) equipped with NFC Contactless Readers (PayPass)
    • App. transfers Credit Card authorization using NFC chip on Mobile device
    • Compatible with Nexus S/Nexus S 4G today
    • Citi MasterCard and Google Card used
  • 21. Google Wallet – Security layers
    • Credit card info stored in encrypted form
    • Secure Element - Separate Chip on phone
      • Its own memory isolated from phone memory
      • Restricted access by “trusted apps” only
    • PIN reqd. to activate phone’s NFC antenna – turned off after each info. exchange
    • Device must be in close proximity reader
  • 22. Wallet Security Layers – Cont’d
    • NFC transceiver is only enabled when the phones screen is illuminated
    • PIN is a must to authorize payment transfers – in form of Secure Credentials
    • Credentials transferred directly using Master Cards Paypass protocol
    • Wallet app prevents obvious weak PIN like 1234 , 1111 & Enforces lock out
  • 23. ISIS Payment Network
  • 24. ISIS Payment Network
    • NFC based Payment Network
    • AT&T, Verizon, & T-Mobile together formed ISIS network
    • Supports VISA, MasterCard, American Express, and Discover
    • ISIS enabled Phones not on the market and Architecture is not yet published
    • US trials starting 2012
  • 25. NFC Adoption Stats
    • Credit card companies worried about new entrants disrupting ecosystem
    • Chicken-and-Egg: People can’t use NFC no hardware – manufactures do not make NFC hardware as people do not use it
    • NFC to become widely deployed by 2014
    • Multiple Startups filling gap between Full NFC and Pure Old Credit Card (POCC)
  • 26.
    • Startups - Mobile Payments Area
  • 27. Square - P-2-P mobile payments
  • 28. SMB and P-2-P mobile payments
    • Square Dongles allows merchants to use Cell Phones/Tablets to swipe credit cards
    • Attachment fits into the audio jack of the iPhone/iPad/Android device
    • App. on the phone then transmits info to Square’s servers and Charges the card
    • VISA recently made a strategic investment
    • Start-up Valued at around $1 Billion!
  • 29. Square Competitors
    • VeriFone – Makes both NFC software and traditional Credit card readers for iPhone
    • Reader Case wraps around the bottom-half and plugs into the dock of iPhone
    • InnerFence is another company that makes a similar card reader for iPhone/iPads
    • Plugs into the dock of the iPhone/iPad
  • 30. FigCard – WiFi based payments
    • Fig card (Paypal) provides an application for Wifi enabled smart phones
    • Cheap USB dongle for Merchant POS
    • Fig card app stores Credit cards details
    • When customer is ready to pay, app on phone sends encrypted WiFi signal to POS
    • Phone number/ Credit card number etc not exchanged – Electronic confirmation
  • 31. Card.io – Capture card info easier
    • App on phone takes a picture of Credit Card
    • Strips out reqd. info & send it to Merchant
    • Deletes picture from phone once completed
    • API available for third-party integration
  • 32. Jumio – Similar to Card.io
    • Mobile app that takes a picture of Card
    • Scans picture and extracts info.
    • Also can use WebCam at a POS terminal
    • Securely transmits data
  • 33. Naratte Zoosh – Ultrasound Paymts
    • Data delivery by ultrasound waves ~20,000 Hz
    • Any phone that plays normal mp3s will work
    • Regular Speakers and Microphone capable of sending and reception
    • Works securely even in noisy environments
  • 34. Wrap-up: Future of Mobile Payments
    • Almost unlimited possibilities for disruption of existing shopping experience
    • Low barrier to demo stage
    • Location aware offers – Phone GPS + NFC
    • Verified check-ins Offers (FourSquare)
    • Personalized Offers (Browsing history)
    • Instant in-store offers (Proximity based)
  • 35. Wrap-up – cont’d
    • Instant coupons, instant offers (on-line)
    • Receipts are electronically processed – Phone App. has a transaction log and actual Receipt could be E-mailed/Scanned
    • Lots of innovation – From SMS based payments to NFC based payments in all markets
  • 36. Q & A
  • 37. Get in touch!
  • 38. References
    • Juniper Research Report: http://www.marketwire.com/press-release/mobile-payments-market-almost-triple-value-2015-reaching-670bn-according-new-juniper-1534333.htm
    • Gartner 2011 mobile data: http://www.gartner.com/it/page.jsp?id=1749114
    • Paypal blog on mobile payments: https://www.thepaypalblog.com/2011/06/paypal-doubles-mobile-payments-predictions-to-3-billion-in-2011/
    • Steve Jobs Images by Albert Watson (Angry old Man) and National Geographic October 1982 - Moira Johnston/Charles O’Rear
    • NFC Technology Architecture: http://www.nfc-forum.org/resources/presentations/
    • Open NFC: http://www.open-nfc.org/infos.html
    • Google Wallet: http://google.com/wallet
  • 39. References – cont’d
    • Google Wallet Security: http://www.pcworld.com/article/228959/google_wallet_security_has_a_weakness.html
    • ISIS: http://www.paywithisis.com
    • Square: https://squareup.com/
    • VeriFone: http://www.verifone.com/
    • InnerFence: http://www.innerfence.com/
    • FigCard: http://figcard.com/
    • Card.io: http://card.io
    • Jumio: https://pay.jumio.com/
    • Naratte: http://www.naratte.com/