How Wireless Technologies Can Transform In-Store Payments

EMVCo has recently published a dedicated white paper – ‘Wireless Payment: Considerations for Use of EMV® Chip’ – which explores the data, security and technology considerations for wireless payments across multiple use-cases. In this post, Jonathan Main, Chair of the EMVCo Wireless Task Force, examines the potential for mobile and wearable devices to use wireless technologies for EMV Chip payments. EMV® Contactless and Near Field Communication (NFC) technology has transformed the in-store payment experience by enabling consumers to pay using their smartphone and wearable devices, in addition to their contactless-enabled payment cards. As mobile and wearable technology has advanced, many devices now support other wireless protocols including Bluetooth, Wi-Fi and Ultra-Wide Band (UWB). The increased range of these wireless technologies – coupled with wide availability, interoperability, security and user control – opens up opportunities for innovative in-store experiences, as the consumer does not have to be right next to the terminal to pay. This comes amid increasing consumer interest for ‘frictionless’ and ‘just walk out’ shopping experiences, with a survey of UK smartphone users indicating that 70% would welcome checkout-free shopping to increase convenience and reduce time spent waiting in line.[1] As interest builds and following feedback from EMVCo Associates, EMVCo has been exploring the potential and required elements necessary to address the use of wireless technologies for in-store payments. EMVCo and wireless payments Before examining the considerations in more detail, it is firstly important to consider the scope of EMVCo’s exploration. While the greater range of wireless technology opens the potential to support all phases of the transaction experience (shopping, payment and completion), EMVCo has focused solely on the payments phase. This phase is initiated by the consumer demonstrating an intent to pay, which prompts the generation and exchange of payment data between the cardholder device and the merchant system. More specifically, EMVCo examined how EMV Chip technology could support the secure communication of data to provide evidence of cardholder involvement, card involvement, and the presence of the cardholder and card in the locality of the merchant: Cardholder involvement Cardholder involvement is the process of establishing that the genuine owner of the card account intends to make a particular payment with their card. This requires intent to pay – an action taken by the user that indicates they want to use their card or mobile device to make a payment. For traditional in-store payments, this is straightforward as the consumer clearly expresses intent by inserting a card into a terminal or tapping their card or device. For wireless payments, the lack of physical proximity to a terminal requires a different approach. The intent could be ‘explicit’, such as the user actively enabling a payment app on their device when they are ready to make a purchase. It may also be ‘implicit’, where the user does not directly acknowledge intent on their device at the time of payment. Examples of implicit intent include entering a payment zone in-store or walking through an entry gate designated for automatic payment. Determining cardholder involvement also requires cardholder verification. Cardholder Verification Methods (CVM) are used to confirm whether the person presenting a payment card is the legitimate cardholder. More advanced mobile devices have enabled consumer verification to be performed on the consumer’s own device – known as Consumer Device Cardholder Verification Methods (CDCVM). This offers various possibilities across wireless payment use-cases. For example, a user could provide biometric authentication on their device to enable a payment for a 30 second window. Or a user could enter a passcode on their smartwatch to enable a payment to be made for as long