MasterCard issues its 2 millionth smart card
MasterCard International's member financial institutions have now issued more than 200 million MasterCard, Maestro and Cirrus branded smart cards around the world, suggesting that global EMV chip deployment on MasterCard payment cards has entered a new phase of mass market adoption in Europe, Latin America, Africa, Asia and the Middle East.
Some 40% of the 200 million smart cards now in circulation carry an EMV chip. In Q3 2004, the number of approved EMV terminals worldwide was approximately 1.5 million, representing an 85% increase in EMV-enabled terminals since 2003.
"2004 has been a period of significant progress for MasterCard in regards to its global chip initiatives," said Dr. Toni Merschen, senior vice president for MasterCard International's Chip Centre of Excellence. "Supporting this trend of migration to chip technology is MasterCard's own M/Chip Deployment Programme."
EMV programme The M/Chip Deployment programme (the basis of MasterCard's OneSMART MasterCard umbrella chip programme), supports all aspects of chip migration and is organised around three streams of activities:
- Product development: Specifications, branded product integration, infrastructure support and services;
- Deployment support: Chip migration services covering business, interoperability and project management aspects;
- Vendor cooperation: M/Chip product development and joint marketing.
Pre-paid debit cards MasterCard chip card issuers can use the M/Chip 4 smart card application as a platform to deliver a range of additional value-added applications, such as:
- OneSMART MasterCard Pre-Authorized: This allows the cardholder to place an amount of cash in a pre-authorised account which is regulated by the chip's open-to-buy counter. The cardholder continues to use the card in an off-line mode until the amount requested exceeds the card's open-to-buy counter, at which point funds must be replenished.
This application also benefits the Maestro brand by allowing debit cards to be issued to new customer segments and accepted by new merchant categories. MasterCard and Capitec Bank in South Africa have recently announced a pilot of the a pre-authorised debit card using the MULTOS chip platform. MasterCard has recently negotiated access to a secure M/Chip card solution from Atmel and Sagem, which it says is particularly well suited to such pre-authorised programmes.
- OneSMART MasterCard Authentication Program: M/Chip 4 cards can be used in conjunction with MasterCard SecureCode to generate the authentication data necessary to guarantee e-commerce transactions. This programme, called the Chip Authentication Program, is a smart card-based solution that being made available to card issuers as part of SecureCode. It can also be used to increase security for internet banking and other applications requiring strong cardholder authorisation.
- OneSMART MasterCard PayPass: M/Chip 4 also supports emerging solutions such as MasterCard's PayPass contactless payment programme. M/Chip 4 can be customised and offered with the PayPass capability, either in contact or contactless mode.
Adding security & loyalty The OneSMART programme includes four pre-configured M/Chip smart card packages ranging in functionality from a basic, single application payment card to a more robust, web-savvy card optimised for internet usage:
- OneSMART MasterCard Retail: This is a simple but powerful chip package, providing a mass market-oriented solution that allows issuers and retailers to encourage and develop card usage. It combines payment, loyalty, and cardholder preference management in a single point of sale transaction.
- OneSMART MasterCard Web: This package allows cardholders to store and manage a range of personal data (e.g. names, addresses, URLs, and web site passwords) on the smart card chip itself.
- OneSMART MasterCard Authentication: This package offers a high level of security for online shopping and remote banking applications.
- OneSMART MasterCard Payment: This package provides the based payment application for general usage.
Driving adoption The widespread shift to chip technology has helped to guide decisions by MasterCard's regional boards in Asia/Pacific, Europe, Latin America/Caribbean, and South Asia and Middle East Africa, who have all recently enacted intra-regional liability shift policies, calling for the full-scale adoption of smart cards and chip terminals by the end of 2006. Migration incentives are already in place in most of these regions as well. A number of regions have also created OneSMART clubs to help banks, retailers and other partners collaborate on strategies for smart card adoption. OneSMART Clubs are already operating across Central and Eastern Europe and in Malaysia, New Zealand, South Africa and Taiwan.