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Standard Bank’s dual purpose NFC/Mastercard payment innovation is believed to be world first

Johannesburg, May 18, 2012 – A multifunctional payments card, incorporating both near field communication (NFC) and debit card functionality, has just been rolled out by Standard Bank`s innovation incubator and business development unit Beyond Payments. This dual function card has met Mastercard stringent requirements and is believed to be a world first in the realm of cashless payment technology.

Developed to meet the requirements of the National Department of Transport (NDoT), the so called Muvo card is being debuted in KZN by the eThekwini Municipality and will be used by commuters to pay for their busfare.

As of the 10th May 2012, an initial  1000 commuters using the PeopleMover bus service, in Durban’s city center, will load credits onto their Muvo card at kiosks, and then tap the card against a card reader upon boarding a bus in order to pay for their ride.   This Pilot phase will be followed by a roll-out to the rest of the 55 0000 commuters throughout the eThekwini Municipality region.

The capabilities of the card, however, go way beyond its NFC functionality. Mastercard technology incorporated into the card means that it can also be swiped at any vendor that accepts debit card payments.

The main components that afford the cards a broad spectrum of usage are the PayPass application, which allows for tap n go payments, and an MChip 4 data chip, which conforms to all MasterCard EMV standards, effectively turning the card into a MasterCard debit card as well.  This card complies with the requirements of the National Department of Transport and is the first of its kind to be introduced in South Africa.

A pre-authorised debit application will be used to allow the card to work in closed loop payment environments, such as the purchase of bus tickets and the deduction of tickets from the card upon boarding the bus. Thanks to the inclusion of EMV capabilities, it will also be possible for merchants to opt to accept the card as a payment method at their stores, on a pre-authorised debit basis.

When the card is presented at a payment device, the fee management systems will calculate the amount payable or ride deduction after which the Standard Bank payments engine will process the transaction.

“The Muvo card is a world first, and showcases a transit ticket sitting inside a banking chip – secured with bank strength security – along with a payment wallet,” said Herman Singh, chief executive officer of Beyond Payments.

“Whilst several flat fee implementations have already been successfully implemented in the market, this solution is notable due to the full use of the NDoT (National Department of Transport) data structure and a fully-fledged electronic card based ticketing capability,” said a representative of Mastercard.

The first 1000 Muvo cards are currently being issued to commuters and the system is up and running, with 23 buses already kitted out with tap n go devices so far. An envisaged  55 000 commuters will make use of this service daily.

Proving that it is on the cutting edge of remittance technology, Beyond Payments can lay claim to more than one world first – at last year’s Oppikoppi music festival, Beyond Payments was the innovator behind the NFC cards that were used by festival goers to purchase food, drinks and festival memorabilia. This cashless, closed loop, “tap n go” system eliminated long queues at ATMs and the chance of festival goers’ cash being lost or stolen.

It also sped up transactions at the concession stands considerably.

More NFC installments are in Beyond Payments’ pipeline, including cashless payment mechanisms for university campuses and implementations in high volume, low value sites such as fast food outlets. Moreover, Standard Bank is currently issuing debit and credit cards that are NFC ready. These will be activated as all banks gradually expand their services to incorporate point of sales devices with NFC functionality.

Finally, as mobile phones with NFC capability start being rolled out, these devices will take the place of tap n go cards. “It is inevitable that we will all be using our phones to pay at merchants in the future,” said Singh. “Standard Bank, for one, will be able to facilitate this. However it’s important to recognise that this is a journey and not a destination – there will be no big bang launch, but eventually we will see all individuals routinely paying with phones at all merchants on the high street.

Created: 18 May 2012  [Banking | Transport | Information Technology (IT)]