EPayments Project Final Report of Initial Project Work rnib innovation Unit



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4.4 Technological


Advances in technology are very likely to impact on this area. Having said that, any significant new technologies are likely to take a long time to become established because they normally require investment in infrastructure to support them, consumer awareness and consumer confidence.
There appears to be a growing provision of services that incorporate mobile phone and payment systems. Examples already available include:

4.4.1 Cash Manager Card


Operated by O2 and NatWest (http://money.o2.co.uk/cashmanager.html)

This is a prepaid card that has credit loaded to it directly from the consumer's bank account. It is a Chip and PIN payment card using Visa as the payment infrastructure. As the card is linked to mobile phone contract the scheme has the following facilities:



  • It allows real time balance alerts to be sent to your mobile phone

  • A spending limit which is governed by how much is loaded on to the card to help budgeting

  • Free to get and use in the UK

  • Online management facility

  • It can be used to top-up your mobile phone.



4.4.2 Visa payWave


Visa payWave can be embedded in a mobile device in order to secure mobile point of sale payments. Visa has demonstrated both NFC-based and SIM-based contactless payments. They have also demonstrated mobile money transfers between Visa accounts, both handset-to-handset and online-to-handset. The scheme includes mobile transaction alerts giving near real-time notification of card purchase activity delivered to a mobile device. Visa are running trials for similar payment systems globally. The key focus seems to be around person-to-person payments.

4.4.3 Paymo


(http://www.paymo.com)

This is a mobile phone based payment system, currently being used for online payments. The user selects the “pay by mobile” option where available and then enters their mobile number. An SMS is sent advising them of the transaction which they reply to with a "Y" to confirm that the transaction is genuine. In theory, this could provide security whilst eliminating the need for users to memorise numerous passwords/login details. At the moment, it's only available from limited sources. There is a risk that it will not become widespread enough to make it a genuine alternative payment method.



4.4.4 sQuid


sQuid is a prepaid contactless smart card. It has been combined with a variety of other cards including one for Greater Manchester Passenger Transport Executive (GMPTE) which allows payment for travel on Arriva buses as well as retail payments. GMPTE are responsible for providing public transport information for Greater Manchester. The contactless smart card can be topped up by a maximum of £100 with the balance and transactions being managed online.
Key selling points include:

  • Don't need to worry about having the right change or identifying specific coins or notes

  • Can't be given the wrong change

  • No PIN number to remember

  • Can be used for transport/retail/leisure/library

  • Potential to trigger RNIB React messages

  • Credit is stored in 3 separate areas to allow specific types of transaction - e.g. Transport money is separate from retail money which is separate from library/leisure services - can't overspend and not have enough to get home!

Concerns:



  • How do you confirm the amount being charged?

  • What happens if your card is lost or stolen?

  • Is the process for topping-up/monitoring transactions accessible

  • Can only be used for small transactions



4.4.5 StagecoachSmart travel card


Stagecoach Group is currently the first UK transport group to pioneer the Government's preferred technology for smart cards across both bus and train services. They have developed their own smart card using the ITSO standard as recommended by DfT and are the first UK bus operator to roll out a smartcard system across an entire operating area with the launch of StagecoachSmart throughout Cambridgeshire26.
Stagecoach anticipates completing the installation of smartcard enabled technology on its entire UK bus fleet by November 2010. The roll out of the StagecoachSmart travel card is expected to continue across the UK bus division, including the potential to integrate with other operator's services in the future. They are also the first company to introduce a smartcard system on the UK rail network, under South West Trains. In 2008 their system was introduced on 54 stations, with expansion planned to 80 stations by the end of 2010.

4.4.6 Mobile Applications


Recent developments in smart phones and the software they use, present some opportunities for improving accessibility to payment systems. The idea of all smart phones being manufactured with near field communication technology incorporated is currently being discussed. Visa has already shown a great deal of interest in exploiting opportunities for using near field communications. One of the key drivers is the international markets where other payment methods are less well developed. An example would be in developing countries that saw a massive take-up in the use of mobile phones generally. These areas do not have the complex payment infrastructure already present in developed countries, making it much easier to introduce a new system that requires a different infrastructure.
This does depend heavily on their being accessible smart phones available. While a lot of work has been done, the move to use touch screen technology could limit accessibility in future mobile phones.

4.4.7 Virtual payments


Increasingly, online payments can be made using virtual currency27. In this scenario, the consumer purchases a number of credits which is either through a secure online transaction or top-up card. The consumer can then make payments for specific items using their virtual credits. Making payments in this way removes the need for a credit or debit card to be used during the transaction. There is a general perception that using credit and debit cards online leaves the consumer vulnerable to fraud, so this payment method could be very attractive. The consumer has control over the funds that are available in the account which allows them to reduce the potential impact of any fraudulent use.
However, the processes of obtaining credit still need to be accessible. If a top-up card is used, the consumer needs to enter a long security code into a website before the credit is applied to their account. If payment is made online, there are still security measures to negotiate as discussed in section 3.1.8.



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