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EMV compliant NFC transaction from a mobile phone

We have one big issue here in Switzerland. Everybody wants to make EMV compliant NFC transactions from a mobile phone. Something like Google Wallet. We have a fully working solution in Switzerland including TSM Services with connection to card manufacturer and issuers. But things got stuck here. Nobody is adapting to this solution and nobody moves in our industry. I try to look into the magic crystal ball and try to explain the problem.

To make secure transactions, according to the security standards of the card industry, you need a secure element in your phone and someone who trust this secure element. In a mobile phone this secure element is usually the SIM card. They guys who trust the SIM cards are the MNO’s. These MNO’s operate a TSM service and establish the trust. Technically perfect, but this is also the problem that get things stuck. It has no technical issues, it is political. The banks just do not want the MNO’s in their food chain. The banks don’t want to share some of their profit with the Telco guys. That’s the problem.

To get things going, there must be a different solution. A solution where the MNO charges for connectivity services and the banks for banking services. Business as usual. But this problem is not easy to solve.

Therefore we did a study with the HSR Hochschule für Technik Rapperswil (University of Applied Sciences of Eastern Switzerland) which researched the possibilities of an EMV compliant mobile payment solution without MNO participation. You can download and read the study here.

The result of the study: It is possible with some restrictions. You need to change a couple of things. But this could be worthwhile since the mobile payment business is proposed to be huge.

What do you think? Please leave your comment.

Abrantix is a payment software engineering company and has extensive knowledge around card payments and EMV. Abrantix also sell an EMV Level 2 Kernel.

Daniel Eckstein

Daniel is the CEO and Founder of Abrantix, a visionary, lateral thinker and the driving force behind Abrantix. With his other partners he has developed the company into a leader in payment software engineering.

Comment by Mark O'Flynn |

You are dead right. Visa, Mastercard (etc) and Banks lose all their hold over (1) the physical brand, i.e. the plastic card which if it disappears ‘into’ the phone, means they lose their brand visibility, and (2) consumers could end up using MNOs/Telecom companies for their ‘banking’ instead of traditional banks and visa/mc.

Comment by Mark O'Flynn |

Also…. any chance you have the rest of your thesis in English? Would love to read all of it.

Comment by Ian Brown |

Yes a full English version would be great.

Comment by Frank Verstraeten |

Well, the fact that Google does have a banking license, would allow them to do the business without any credit card companies anymore in the middle. Also, I have the feeling, that companies like Google & Apple might invest in network carries to have a full grip on the user, which would make the whole payment process even more secure than “just” providing the underlying OS.

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