Mastercard was the first in Russia to provide cardholders with the opportunity to use Apple Pay and Samsung Pay. The payment system was the first to launch its tokenization platform in this market - Mastercard Digital Enablement Service (MDES) turns a device connected to the Internet into a means for secure payment; it is with this service that global wallets work. Read about how a smartphone has become an alternative to a plastic card, and how technologies have developed to ensure security when paying with a mobile phone.
One-touch payment as a driver for the development of digital payments
The creation of contactless payment technology Mastercard (formerly Mastercard PayPass) can be considered a turning point in the development of electronic payments. This happened in 2002: with new technology, the payment process went beyond the usual “plastic” form factor - now you can pay with a key fob, wristwatch, mobile phone, sticker, etc.
In Russia, contactless technology appeared 8 years ago, and since then the number of issued cards in various (contactless) form factors, as well as the network for accepting this payment method, has been steadily growing.
Today you can pay with one touch at 6 million retail outlets in 77 countries, including 42 European countries. In just three years, all POS terminals in Europe (including Russia) will accept contactless payments. This means that you can pay everywhere with your phone, watch or jewelry. No, do not give them as payment, but simply bring them to the reader!
In addition, Russia has become one of the first and few countries in which 3 main technologies are available with Mastercard for loading contactless cards into NFC smartphones. Thanks to Mastercard contactless technology, it is now possible to issue a mobile card on a SIM card (using SIM-centric technology), on an embedded phone chip (embedded Secure Element), and in the “cloud” (using Host Card Emulation technology).
Russia's first project in the field of mobile contactless payment based on SIM-centric NFC started in 2012, and it was launched by Mastercard together with MTS. The user needed to go to the point of sale of the mobile operator and replace his regular SIM card with a special one that supports the contactless payment function, with a Mastercard already stored on it. This is how the NFC phone turned into a means of payment.
Later, a number of projects were launched in this area with the largest telecom operators, mobile device manufacturers and banks.
In 2013, Mastercard, Tinkoff Bank and CardsMobile (i-Free group) for the first time in Russia launched a full-featured service for remote loading of contactless Mastercard cards into the Wallet mobile application for a number of HTC, Sony and Philips smartphones with a built-in NFC chip.
In July 2015, an updated version of the Wallet application from CardsMobile and the Alfa Touch application from Alfa Bank and the BPC company became available for download on Google Play. HCE technology and the Mastercard Cloud Based Payments specification have made it possible to significantly increase the base of supported devices to dozens of models from popular manufacturers and expand opportunities for new developers and banks.
By developing digital solutions and offering Mastercard cardholders more and more convenient payment methods, Mastercard provides a high level of transaction security. An important step was the tokenization service.
Tokenization to ensure payment security
The launch of Apple Pay on the Russian market was made possible thanks to the introduction of tokenization. This technology provides a high level of convenience when issuing card products to mobile NFC devices and the maximum level of security when paying through electronic wallets, for example, Apple Pay and Samsung Pay.
The MDES tokenization platform was first introduced by Mastercard in 2013 and has become the basis for further developments in the field of efficient and secure digital payments.
In 2014, the Apple Pay service was launched in the United States using this platform. Today, MDES guarantees the security of more than 40 million cards, and Mastercard is working to add another 225 million cards in 18 countries, allowing users to pay where, when and how it is convenient for them.
What is tokenization? This is the replacement of the card's primary account number (PAN) with a 16-digit combination of numbers (token). It is linked within the Mastercard network to the bank card number. In this case, the token is unique for each of the connected devices.
When making a payment, Mastercard transforms the token into a card number so that the bank is sure that the payment is made by its holder. Upon payment, the token is sent to the seller. When a merchant sends payment authorization data to the bank, Mastercard verifies that the token is valid and came from the device it is linked to.
The token allows you to hide the actual bank card data and ensure the maximum level of transaction security. The buyer can be sure that all data is securely protected.
Additional security is provided by cryptography and biometrics, which create another barrier to keep your money safe. Biometric protection of modern mobile gadgets and the possibility of guaranteed blocking or destruction of data if a smartphone is lost is another milestone that ensures the safety of your money.
MDES for everyone
Mastercard has tried to make working with MDES as simple as possible not only for users, but also for partners - banks and technology companies.
To enable customers to pay for purchases with a smartphone, the bank does not have to connect to Apple Pay, Samsung Pay or any other wallet. The bank just needs to connect to the MDES platform and add the corresponding functions to its own mobile application.
Now a person at a point of sale - a physical or online store - can pay using existing mobile applications to which bank cards are linked. Mastercard gives banks the opportunity - not as a replacement, but as an addition - to do everything the same, but in their wallet, in their application.
Thus, a digital wallet, mobile bank or online bank becomes the same means of payment as a bank card. Only instead of “plastic” - your favorite gadget and biometric authorization.
Ease of implementation
Russian partners of Mastercard noted that the implementation of MDES was one of the fastest in their practice. From a technical point of view, the bank or electronic money service only needs to certify the platform. The rest is essentially organizational issues.
The only thing that differs for the bank in the authorization and clearing process is the intervention of the so-called “MDES loop” on the side of the payment system, which tokenizes the payment and compares the token during the transaction. Nothing conceptual changes inside the bank’s IT kitchen due to the fact that tokenization occurs when paying by phone. There are certain settings related to reporting and other nuances, but the principle of transaction processing remains the same. Simple, transparent and effective.
Simplifying authorization
Mastercard is constantly developing new payment confirmation standards and developing the concept of online payments that do not require passwords and will replace the 3D Secure protocol. To make it even easier to identify a buyer when shopping online and confirm payment with a contactless device, Mastercard has developed a service with which this process takes place using what we always have at hand.
The new payment app Identity Check Mobile uses biometrics - fingerprint and facial recognition - for online purchases. Payment via selfie has become a reality! Pilot projects with ID Check have already been launched in 12 countries. In 2017, this solution will be distributed worldwide. This solution is planned to be rolled out worldwide in 2017.
The idea of verifying identity using selfies was previously laughed at, but the technology works great. To begin with, you will need to download the appropriate application and take a selfie, but not just a photo, but a small video. You definitely need to blink to confirm that there is a living person in front of the camera - the card holder and owner of the device.
Mastercard technologies accelerate the development of online shopping, making it even more convenient. Thanks to innovation, the number of people actively shopping online is constantly growing: ten years ago there were about ten million of them worldwide, and this year three billion people have bought something from an online store at least once. Simplicity and convenience of payment for each of them is at the forefront.
The pace of development of digital payments
Moore's Law has probably already been reflected in one form or another in almost any human activity, and here, albeit indirectly, it affects how life changes.
Magnetic stripe appeared on cards in 1972, and chip protection became common only thirty years later. The MDES platform did not exist two years ago! Biometric identification in the form of ID Check a year and a half ago caused ironic comments and smiles at technology exhibitions, and today it has been brought to life. And ID Check really has the potential to change the way you pay for your purchases. Not only fingerprint sensors, but also iris scanners have already begun to appear in phones.
The rapid pace of development of payment means will find its response both in the lives of ordinary citizens (despite the very clear division of users into “early adopters” and skeptical conservatives), and in the development of small businesses, which are considered one of the drivers of commerce development.
One-touch payment as a driver for the development of digital payments
The creation of contactless payment technology Mastercard (formerly Mastercard PayPass) can be considered a turning point in the development of electronic payments. This happened in 2002: with new technology, the payment process went beyond the usual “plastic” form factor - now you can pay with a key fob, wristwatch, mobile phone, sticker, etc.
In Russia, contactless technology appeared 8 years ago, and since then the number of issued cards in various (contactless) form factors, as well as the network for accepting this payment method, has been steadily growing.
Today you can pay with one touch at 6 million retail outlets in 77 countries, including 42 European countries. In just three years, all POS terminals in Europe (including Russia) will accept contactless payments. This means that you can pay everywhere with your phone, watch or jewelry. No, do not give them as payment, but simply bring them to the reader!
In addition, Russia has become one of the first and few countries in which 3 main technologies are available with Mastercard for loading contactless cards into NFC smartphones. Thanks to Mastercard contactless technology, it is now possible to issue a mobile card on a SIM card (using SIM-centric technology), on an embedded phone chip (embedded Secure Element), and in the “cloud” (using Host Card Emulation technology).
Russia's first project in the field of mobile contactless payment based on SIM-centric NFC started in 2012, and it was launched by Mastercard together with MTS. The user needed to go to the point of sale of the mobile operator and replace his regular SIM card with a special one that supports the contactless payment function, with a Mastercard already stored on it. This is how the NFC phone turned into a means of payment.
Later, a number of projects were launched in this area with the largest telecom operators, mobile device manufacturers and banks.
In 2013, Mastercard, Tinkoff Bank and CardsMobile (i-Free group) for the first time in Russia launched a full-featured service for remote loading of contactless Mastercard cards into the Wallet mobile application for a number of HTC, Sony and Philips smartphones with a built-in NFC chip.
In July 2015, an updated version of the Wallet application from CardsMobile and the Alfa Touch application from Alfa Bank and the BPC company became available for download on Google Play. HCE technology and the Mastercard Cloud Based Payments specification have made it possible to significantly increase the base of supported devices to dozens of models from popular manufacturers and expand opportunities for new developers and banks.
By developing digital solutions and offering Mastercard cardholders more and more convenient payment methods, Mastercard provides a high level of transaction security. An important step was the tokenization service.
Tokenization to ensure payment security
The launch of Apple Pay on the Russian market was made possible thanks to the introduction of tokenization. This technology provides a high level of convenience when issuing card products to mobile NFC devices and the maximum level of security when paying through electronic wallets, for example, Apple Pay and Samsung Pay.
The MDES tokenization platform was first introduced by Mastercard in 2013 and has become the basis for further developments in the field of efficient and secure digital payments.
In 2014, the Apple Pay service was launched in the United States using this platform. Today, MDES guarantees the security of more than 40 million cards, and Mastercard is working to add another 225 million cards in 18 countries, allowing users to pay where, when and how it is convenient for them.
What is tokenization? This is the replacement of the card's primary account number (PAN) with a 16-digit combination of numbers (token). It is linked within the Mastercard network to the bank card number. In this case, the token is unique for each of the connected devices.
When making a payment, Mastercard transforms the token into a card number so that the bank is sure that the payment is made by its holder. Upon payment, the token is sent to the seller. When a merchant sends payment authorization data to the bank, Mastercard verifies that the token is valid and came from the device it is linked to.
The token allows you to hide the actual bank card data and ensure the maximum level of transaction security. The buyer can be sure that all data is securely protected.
Additional security is provided by cryptography and biometrics, which create another barrier to keep your money safe. Biometric protection of modern mobile gadgets and the possibility of guaranteed blocking or destruction of data if a smartphone is lost is another milestone that ensures the safety of your money.
MDES for everyone
Mastercard has tried to make working with MDES as simple as possible not only for users, but also for partners - banks and technology companies.
To enable customers to pay for purchases with a smartphone, the bank does not have to connect to Apple Pay, Samsung Pay or any other wallet. The bank just needs to connect to the MDES platform and add the corresponding functions to its own mobile application.
Now a person at a point of sale - a physical or online store - can pay using existing mobile applications to which bank cards are linked. Mastercard gives banks the opportunity - not as a replacement, but as an addition - to do everything the same, but in their wallet, in their application.
Thus, a digital wallet, mobile bank or online bank becomes the same means of payment as a bank card. Only instead of “plastic” - your favorite gadget and biometric authorization.
Ease of implementation
Russian partners of Mastercard noted that the implementation of MDES was one of the fastest in their practice. From a technical point of view, the bank or electronic money service only needs to certify the platform. The rest is essentially organizational issues.
The only thing that differs for the bank in the authorization and clearing process is the intervention of the so-called “MDES loop” on the side of the payment system, which tokenizes the payment and compares the token during the transaction. Nothing conceptual changes inside the bank’s IT kitchen due to the fact that tokenization occurs when paying by phone. There are certain settings related to reporting and other nuances, but the principle of transaction processing remains the same. Simple, transparent and effective.
Simplifying authorization
Mastercard is constantly developing new payment confirmation standards and developing the concept of online payments that do not require passwords and will replace the 3D Secure protocol. To make it even easier to identify a buyer when shopping online and confirm payment with a contactless device, Mastercard has developed a service with which this process takes place using what we always have at hand.
The new payment app Identity Check Mobile uses biometrics - fingerprint and facial recognition - for online purchases. Payment via selfie has become a reality! Pilot projects with ID Check have already been launched in 12 countries. In 2017, this solution will be distributed worldwide. This solution is planned to be rolled out worldwide in 2017.
The idea of verifying identity using selfies was previously laughed at, but the technology works great. To begin with, you will need to download the appropriate application and take a selfie, but not just a photo, but a small video. You definitely need to blink to confirm that there is a living person in front of the camera - the card holder and owner of the device.
Mastercard technologies accelerate the development of online shopping, making it even more convenient. Thanks to innovation, the number of people actively shopping online is constantly growing: ten years ago there were about ten million of them worldwide, and this year three billion people have bought something from an online store at least once. Simplicity and convenience of payment for each of them is at the forefront.
The pace of development of digital payments
Moore's Law has probably already been reflected in one form or another in almost any human activity, and here, albeit indirectly, it affects how life changes.
Magnetic stripe appeared on cards in 1972, and chip protection became common only thirty years later. The MDES platform did not exist two years ago! Biometric identification in the form of ID Check a year and a half ago caused ironic comments and smiles at technology exhibitions, and today it has been brought to life. And ID Check really has the potential to change the way you pay for your purchases. Not only fingerprint sensors, but also iris scanners have already begun to appear in phones.
The rapid pace of development of payment means will find its response both in the lives of ordinary citizens (despite the very clear division of users into “early adopters” and skeptical conservatives), and in the development of small businesses, which are considered one of the drivers of commerce development.
