Is 2022 the year of SoftPos?
A year ago, at the start of 2021, I thought it was going to be the year of SoftPos. It was all over the news and contactless limits were being raised globally to encourage touchless Covid friendly payments. The reality is that despite all the hype, last year the market just inched forward. There were a few more pilots, some small rollouts, but no new specs, standards or major changes.
We are now one month into 2022 and already the stars seem to be aligning. The first draft of the PCI MPoC spec is out for PCI Mobile Task Force members to review. This is the new spec from PCI that we have all been waiting for, it will enable large scale deployments of SoftPos solutions with PIN. It’s got more up its sleeve too, but that’s a discussion for later, once the specs are made public. The MPoC specs have been keenly anticipated and a great step forward, but they sadly need to go through a several rounds of reviews and aren’t expected to be publicly released before the end of the year. What’s good to hear though, is that local payment schemes and standards like Girocard from Germany and ep2 from Switzerland are also looking into MPoC and working out how to align their local solutions. Hopefully we will soon have the chance to push out large scale, production ready multi-scheme SoftPos solutions.
There are still a few countries however, including the UK where I live, that may struggle to deploy SoftPos at large scale due to the offline PIN issue. In offline PIN markets, the card itself validates the PIN rather than the bank host. This doesn’t work with contactless transactions because by the time you have entered your PIN the card has been taken out of the contactless field, so there is no opportunity to check if its valid. In the UK specifically, the contactless limit has been increased to £100 which certainly helps and makes solutions more viable, but longer term it would be good to see a move to online PIN.
The other interesting piece of news comes from Apple. Apple have always refused to let third party developers gain access to the contactless reader built into iPhones for use in payment scenarios. Whilst technically an iPhone could also support a third party SoftPos app, Apple has never enabled the API required. However, back in 2020 Apple acquired a Canadian start-up called Mobeewave, who had developed one of the first SoftPos solutions on the market. Since the acquisition, Apple has maintained radio silence on this subject until now. They have just announced Tap to Pay on iPhone will be rolling out in the US later this year. It’s initially in a partnership with Stripe, but
they say that they are delivering a technology platform for use by third party solutions providers to make use of. If that’s the case its an exciting milestone, and I look forward to reading the details. It’s a welcome change from Apple, who historically have tried to own the entire ecosystem. The best news is that when Apple is willing to deploy a solution it usually tells the market that the technology is ready for mainstream use, and therefore should help drive the market forward. It took Apple’s launch of Apple Pay to drive phone based NFC payments to become mainstream (with a little help from Covid!).
So, I’m encouraged by the progress, let’s see what the rest of 2022 has to offer SoftPos!