Chip and PIN goes wireless

Michael Garwood
December 5, 2011

Having returned to the mobile industry in February with Work Mobile, Yes Telecom founder Keith Curran has teamed up with mobile payment specialists eMerit on a product which, he tells Michael Garwood, will “revolutionise” chip and PIN

Last month, Paris played host to the Cartes and Identification conference, an annual international event showcasing global players in the digital security and payments space.

The three-day event brought together more than 450 companies from around 150 countries and attracted 20,000 visitors.

Among those exhibiting was Manchester-based app developer eMerit Solutions, headed up by CEO Tim Corke (pictured centre), former Data Select commercial director Simon Boyd (pictured left) and Yes Telecom founder Keith Curran (pictured right).

Emerit attended the event as guests of payments firm Visa to unveil what it claims is the first “true” mobile payment solution in the UK to combine mobile with the security and familiarity of chip and PIN.

The product went on sale through eMerit’s distribution partners Micro-P and Data Select, and the company confirmed last week that it is in the final stages of securing a deal with HSC. The service has been showcased at the past three Data

Select platinum club dealer events and the company claims the feedback it has received has been “extremely positive”. It is already in discussions with network operators about a white-label version (see boxout on page 34).

Emerit claims there are more than 800,000 small businesses in the UK who would benefit from accepting payments wirelessly using mobile data or Wi-Fi, highlighting construction workers and gardeners as potential target markets.

Corke, who joined the company 18 months ago, says eMerit had to find a solution that customers found both familiar and trustworthy and that would sit within the banking infrastructure.

He says: “There is a huge segment of the population today who are only used to using cards to make payments, and the banks have all heavily invested in chip-and-PIN infrastructure so we couldn’t simply ignore that.

“But the world is changing and mobility is key. So we looked at ways for people to use their smartphone as an acceptance device that the banks would support, and we’ve done that. No one is doing this at present.

“It looks really simple, and for the customer it is because it’s immediately familiar.

“Our target market is small businesses and the micro-merchants – traditionally builders, plumbers, electricians. But it really can be anyone.”

Curran, who began working with eMerit as business development director in January, adds: “Chip and PIN is deemed to be the most secure aspect of card payments in the world today. But the downside is it’s cardholder-present and in a fixed environment.

“So the challenge for us was how do we get chip and pin outside the fixed environment and retain that trust and level of security you expect? ID theft has become the biggest criminal activity on the planet and that was what led us on to a much bigger way of thinking.

“With eMerit those levels of security are retained. The mobile device never sees the details from the card and at no stage does the payee hand over their credit or debit card. We are not trying to do this under the radar, this is a mainstream thing.”

Connecting to eMerit
All businesses wishing to use eMerit are required to pass a credit check.

Those who are accepted will receive a link to download the eMerit application to the smartphone or tablet device they wish to use to accept payments.

The business enters the details of the sale, be it services or a product on the application that can be customised to its requirements. Once the information has been entered, the mobile device will connect via Bluetooth to the chip-and-PIN reader.

The process for the payee mirrors that of any fixed chip-and-PIN sales environment – they are asked to enter their card, accept the amount and enter their PIN number. If the PIN is accepted, the transaction will be sent instantly via 3G or Wi-Fi to the bank, which will either confirm or deny it.

Curran says: “The file sizes are tiny so you don’t need a strong 3G connection; you don’t need to think about upgrading your contract package because of the data used.”

Customers will be charged a generic service fee on all transactions (the demonstration model charged three per cent). All major cards are accepted, excluding AMEX.

As mentioned, the mobile or tablet “never” receives the card details and all the information is encrypted for the bank’s use only.

The eMerit application is currently compatible with BlackBerry (mobile only) and Android (handset and tablet). It will be available on iOS from Q1.

Full article in Mobile News issue 503 (December 5, 2011).

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