NFC Times Exclusive: The cost and complexity of loading and provisioning applications on secure elements in NFC phones has held back mobile-payments rollouts and added to the growing interest of such alternatives as host-card emulation, Bluetooth low energy, even QR codes, observers agree.
But use of SIMs or embedded chips in NFC phones is still the most standardized and mature technology for enabling mobile payments at the physical point of sale, especially such open-loop applications as Visa payWave and MasterCard PayPass. And as NFC Times has reported, the growing interest in alternative technologies has caused such NFC ecosystem players as mobile operators to seek out ways to simplify the process for provisioning secure elements on NFC phones.
One of the simplification measures that has been gearing up for the past two years is the creation of more centralized TSM platforms, which backers contend would greatly decrease the number of connections needed to link service providers with issuers of secure elements, such as mobile operators and handset makers. The backers of the centralized TSM platforms also hope to gain a stronger hand in the market to win business from banks and other service providers.
Visa and MasterCard have contracted with TSM vendors to offer their own TSM platforms that can aggregate payment credentials from numerous banks and other issuers to be provisioned over the air to SIMs or embedded chips.
The big card schemes are also setting up hubs, which could act as a central point to link service provider TSMs on one side–including Visa and MasterCard’s own TSMs–with secure element issuer TSMs on the other.
The work to build the hubs is behind schedule, especially for Visa, which made a splash just under a year ago in announcing it would preload its payWave applet on embedded chips in Samsung NFC phones globally and link Visa-issuing banks to the chips using its own hub. Visa said it would also introduce a TSM service, mainly targeted at second- and third-tier issuers.
But Visa has yet to launch its first project on Samsung's embedded chips. And it is not believed to have launched the TSM service yet, either.
Westpac Bank in Australia is expected to launch soon with a payWave application in Samsung phones, however. And Visa has also been lining up mobile operators to preload its applet on their SIMs, which could then be connected to Visa's planned hub. MasterCard, which beat Visa to launching PayPass on embedded chips in Samsung phones in December, has similar plans for a hub.
Meanwhile, on the national level, payment processors and banking groups, such as those in Italy, Poland, China, Hong Kong, Denmark and, soon, Taiwan, have been building their own TSM platforms to aggregate payment applications to be issued by their member banks. These include China UnionPay, SIA in Italy, Trevica in Poland, Jetco in Hong Kong and Nets in Denmark.
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• Table on SP-TSM aggregators, SEi-TSM aggregators and hubs that have launched or are in the process of doing so, with backers of each platform and vendors providing the technology
• Estimated budget for “owning” your own service provider TSM
Among Topics Covered:
• Trends for some banking, processing and payments groups or companies to set up centralized TSM platforms
• Planned hubs from Visa and MasterCard Worldwide
• Details on groups that have set up centralized TSM platforms or are in the process of doing so.
• Reasons many big banks decided to run their own TSMs
• The power of the hub concept
• So You Want to own a TSM?
• Fee structure for service provider (SP) TSMs
• Reasons some banks, even large ones, are likely to plug into aggregators in the early NFC market.
Among companies and organizations mentioned:
Visa
MasterCard Worldwide
Samsung Electronics
China UnionPay
SIA
Jetco
Nets
Gemalto
Oberthur Technologies
Morpho
Giesecke & Devrient
Cardtek Group
Among Sources Quoted:
• Marcin Cichocki, head of products and delivery, Trevica
• Stefania Gentile, head of cards and payments, Intesa Sanpaolo
• Marco Polissi, head of product development for financial institutions, SIA
• Arnaud de La Chapelle, former managing director, solutions business, Oberthur Technologies
• Thian Yee Chua, SVP, convergence services, Morpho
• Rémi de Fouchier, VP, marketing communication, Gemalto
• Ozgur Gungor, general manager, Phaymobile (Cardtek Group)
• Kristian T. Sørensen, senior manager, corporate mobile & e-commerce, Nets
• Atsushi Kusano, spokesman, Toppan Printing
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