Case Study (MasterCard)

 

MasterCard PayPass

Client: MasterCard

Background/Objectives

MasterCard is in the process of extending its product range to include "proximity technologies". These technologies enable terminals and cards to exchange data without physical contact. Building on MasterCard's internationally accepted debit and credit payment programs, these technologies provide cost-effective solutions that enable transactions to be performed in a wide variety of acceptance environments.

Until now, payment transactions at a Point of Sale (POS) terminal required physical contact between the card and the terminal. This physical contact would be made by:

• swiping a magnetic stripe (for magnetic stripe cards)
• inserting a chip card into a reader (for contact chip cards)

The first proximity technology, MasterCard PayPass, selected by MasterCard, is based on RFID or contactless chip cards (compliant with the ISO/IEC 14443 standard). PayPass enabled devices allow the cardholder the ability to make payments by simply tapping their card on suitably equipped readers at PayPass enabled merchants. Unlike EMV or other chip card technologies where the cardholder realises little personal benefit of the technology, PayPass provides the cardholder with an immediate and identifiable difference, offering convenience and speed.

The successful trials of MasterCard PayPass in Florida demonstrated the latent demand from consumers for this convenient payment product. MasterCard trials have shown an increase in card usage and average spend with PayPass. It also offers fantastic opportunities for organisations wishing to co-brand with other industry sectors.

Approach and Benefits to Client

Consult Hyperion worked with MasterCard on the development of PayPass in a number of projects, helping MasterCard to take the product from a concept to commercial deployment. Having been involved from the initial phase of PayPass, we understand every aspect of the PayPass system and its real-world, mass-market deployment. We helped MasterCard by:

• Analysing the product marketplace and technologies available for use as a Proximity Payment method including RFID, Bluetooth, Infrared, etc.
• Developing Technology Roadmaps for all potential solutions. These significantly simplified the decision making process as they allowed the MasterCard and Member Bank executives to rapidly understand the short to medium term risks and rewards offered by each solution.
• Producing Scenario Storyboards depicting various usage scenarios from the viewpoint of various stakeholders (e.g. Merchant, Consumer, Issuer) which were used to help sell the concepts to the first pilot partners.
• Constructing a prototype Point of Sale (POS) system which was used to refine user requirements and to demonstrate the early technical specifications to potential Merchant partners.
• Integrating one of the POS terminal adaptors for a number of different pilot implementations.
• Implementing the PayPass application on a multi-application smartcard platform for use as a reference implementation for testing terminals and benchmarking card products.
• Producing Acceptance Testing specifications for cards and terminals for the pilot launch and conducted the acceptance testing at the application level for all pilot cards and readers.
• Preparing Implementation Guides and Information Papers for both card and non-card PayPass products.
• Supporting the development of test and certification products for PayPass.

Consult Hyperion's ability to provide high-quality, cost-effective consultancy support to MasterCard has been a significant contribution to the success of the product.