visa paywave in transit pdate
TRANSCRIPT
Our vision for Visa payWave/ payWave for Mobile
VISION To enable contactless payments with any product (mobile or card), for any amount in every European market
ACTIONS
1. Put the infrastructure in place (Issuance & Acceptance) and get the basics right (business case and product proposition) to enhance the customer experience and drive adoption/usage
2. Publish Terminal mandates and develop product enhancements to facilitate (mobile) card adoption
3. Engage with Members, Partners, Stakeholders & Ecosystem participants to expand NFC usage
AMBITION
• 50% of terminals in Visa Europe to be capable of accepting NFC transactions by the end of 2015; all terminals by 2020.
• 50% of all cardholders having access to a contactless payment instrument (card and/or mobile) by 2015; all by 2020.
A day in the life our vision
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Leave home Park the car Buy newspaper
Grab a coffee
Lunch Board the train
Back on the train
Grab a snack Pick up the car Home again
Key insights from the European market
>70 Acquirers
>100Issuers
21 markets
55 million cards
700k terminals
volumes x5contactless transaction in last year
Pilot
Study phase
Consumer rollout
•Iceland•Norway
•UK•Ireland
•Germany
•Finland
•Sweden
•France•Austria
•Poland
•Slovakia
•Hungary
•Czech Rep
•Lithuania
•Estonia
•Latvia
•Italy•Spain
•Portugal
•Turkey•Greece
•Romania
•Luxembourg
•Bulgaria
•Switzerland
•Cyprus
•Israel
•Slovenia
•Denmark
•Netherlands
•Belgium
Key insights from the European market
Key insights from the European market
Apr 2011 Feb 2013
PolandUKTurkeySlovakiaSpainFranceSwissItalyCZRomaniaP
oS s
pend
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Background
Transit agencies across Europe face significant challenges
• Seek new solutions that boost operating efficiency
• Need to free up time and resource to focus on core services
• Require to make services accessible, interoperable, inclusive
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The Visa contactless payments advantage
Any Visa contactless card accepted
No ticket queuing
Fast, simple experience
Travel on any network
Passenger benefits
No ticketing or top-up queues
Reduction in op-ex
Improved accessibility and security
Enables sharper focus on core transit provision
Transit operator benefits
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Trends in transport fare collection
Transport ticketing strategies are being driven by key trends towards contactless bankcards and NFC mobile telephones
Smart
Paper
Account-basedCard-based
Major trend Major trend
Direct p
ath
Direct p
ath
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Our vision is clear
We want to boost the passenger propositions and stimulate usage of public transport
• Convenience – an compelling offering that’s easy to understand
• Speed – transactions that will not slow busy passengers down
• Security – all the usual levels of transaction security people expect from Visa
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Visa Contactless Transit Solutions
To address the needs and requirements of transit operators, we have developed various Visa contactless Transit Solutions
Retail Known Fare Variable Fare
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Retail model
The Retail Model is ideal in environments where transaction speed is not essential
Retail
Delivering the goal of ‘one card, go anywhere’
• Retail model – all cards accepted
• Pay at terminal onboard or at station
• Fare calculation at point of sale
• Payment made to buy ticket
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Known Fare model
The Known Fare transit model enables simple known-value ticketing in environments where speed is critical
Known Fare
Delivering the goal of ‘one card, go anywhere’
• Transit model – contactless only
• Pay known fare onboard or at gate
• Fare calculation at point of sale (reader)
• Payment card is ticket
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Variable Fare model
The Variable Fare transit model enables complex, multi-modal ticketing in environments where transaction speed is critical
Variable Fare• Transit model – contactless only
• Present card for authentication onboard or at gate – entries and exits
• Fare calculation in back office at end of day
• Payment card is ticket
Delivering the goal of ‘one card, go anywhere’
Variable Fare transaction sequence
Variable Fare transit acceptance represents a new transaction model for Visa Europe Issuers
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1. Final fare amount is not known until the end of the day’s travel
2. Transit terminals perform offline authorisations with the card
3. Records taken of ‘entries’ and ‘exits’ from the system, plus any intermediate validations performed during a journey
4. Back office system reconstructs journeys made
5. Journey information is used at EoD to calculate the final fare
6. Transit agency’s central systems generate the authorisation and/or clearing messages, as specified
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Summary of Visa Contactless Transit Solutions
The versatility of Visa Transit Solutions enables contactless to be deployed in a wide range of transit environments
Retail Model Known Fare Variable Fare
Ideal transit environment Known fares, speed not essential
Known fares, high- speed
Complex multi-modal fares, high-speed
Acceptance All cards Contactless-only (transit only)
Contactless-only (transit only)
Fare calculation method Point of entry Point of entry Zero value taps, journey is host-calculated
Special fares supported No No Capping, travel cards & concessions
Special requirements None None Touch in/out, requires host
System components
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Bank system
Merchant back-office
systems
Terminal equipment
Passenger control systems
Acquirer
Auth Processing Fare Processing
Inspection deviceRetail terminal
Gate or turnstile mechanisms
Contactless terminal
Mobile or static terminal
Retail model
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Passenger Journey
Contactless usage
Transport
Back office processing
VisaNet
Cardholder Entry Exit
AuthorisationsClearing
Transaction processing
Known Fare (offline terminals)
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Passenger Journey
Contactless usage
Transport
Back office processing
Clearing
VisaNet
Cardholder
Transaction processing
Entry Exit
Contactless-only terminal
Variable Fare (online terminals, entry only)
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Passenger Journey
Contactless usage
Transport
Back office processing
AuthorisationsClearing
VisaNet
Cardholder
Custom auth processing
Fare & aggregation processing
Entry Exit
Variable Fare (online terminals, entry/exit)
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Passenger Journey
Contactless usage
Entry ExitTransport
Back office processing
AuthorisationsClearing
VisaNet
Cardholder
Custom auth processing
Fare & aggregation processing
Variable Fare (revenue inspection)
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Passenger Journey
Contactless usage
Entry ExitTransport
Back office processing
AuthorisationsClearing
VisaNet
Cardholder
Revenue Inspection
Customers will vote with their cards
transactions by week 16
1.5million
of bus transactions are Visa
93% Contactless payments already represent approximately 20% of cash payments
Other major transit projects in Europe
contactless transit transactions per month from Poland
400k
of transit transactions in Wroclaw
Visa
70%
• Wroclaw (buses & trams)
• Warsaw (buses & trams)
• Istanbul (ferries)
• Others coming soon
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What have we learnt?
A great passenger experience begins and ends with seamless authentication of their Visa contactless card
• Card collision / tearing
• Multiple reader technologies
•Authentication speed
•Deny list management
•Customer messaging
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What have we learnt?
The Custom Auth Model is a risk management system which is a back-office feature of a Variable Fare implementation
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What have we learnt?
The Custom Auth Model is a risk management system which reduces the volume of online-authorised transit transactions
Custom auth processing
Merchant Floor Limit
Cumulative Offline Spend
Max Time Between Auths
Online Auth Requested
£15 £15 14 days by Card
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Characteristics of a transit terminal
Transit terminals are unlike retail terminals in that they:
• are contactless-only
• do not support PIN or signature
• may be attended, semi-attended or unattended
• are online-capable
• may not be capable of processing online transactions in real time
• may not be able to print receipts
• may not allow amount entry
• do not support refund or reversals (except via back office)
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Offline card authentication
Visa cards, tags and mobiles can verify their authenticity in an offline manner using cryptography
• Visa payment devices can be personalised to return an Offline Data Authentication (ODA) certificate for every transaction, including those with a value of zero.
• This feature is essential in transit due to the deferred authorisation process which is utilised.
Contactless acceptance in Variable Fare model
• Transit terminals require all cards and mobiles to support Offline Data Authentication (ODA) functionality
• Any card or mobile which does not perform ODA will always be rejected by a transit terminal
• Transit terminals are configured to indicate to cards and mobiles that they are online-capable
ODA
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Tried and tested
Visa continues to carefully monitor learning from transit projects to refine and enhance the proposition
• Substantial transaction volume – but only just getting started
• Important learning has been incorporated into transit models
• New learning has given us better operational understanding
• We look forward to a significant market pull in 2014
Variable Fare model compatibility
Specification Perso profile Accepted in TfL Phase 1? Accepted in TfL Phase 2?
VCPS 2.0.2
Online-Only
Offline-Capablewith offline funds
VCPS 2.1.1
Online Onlywith template BF63 and
ODA bit set
Offline Capablewith template BF63 and
ODA bit set
No support for ODAagainst rules
Transit documentation
Specs & Implementation Guides Document Description Ver. Target
Visa Europe Transit Terminal Implementation Guide Terminal requirements and capabilities 1.0 Terminal
vendors
Merchant Implementation Guide (Variable Fare)
Contactless Capabilities Overview description of the Contactless Capabilities data and processing
1.1 Merchants
Issuer Implementation Guide (Variable Fare)
The purpose of this guide is to help Visa issuers that issue Visa payWave cards understand the implications of cardholders using those cards on public transit systems that implement Visa payWave Transit Solutions – Variable Fare acceptance
1.0 Issuers
Acquirer Implementation Guide (Variable Fare)
The purpose of this document is to help Visa acquirers to process payments from “Variable Fare” transit merchants
1.0 Acquirers
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Operating Regulation changes
Member Letter Document description Release Date
Member Letter: VE 74/11 Proximity payment-only acceptance for transit merchants 19 Dec 2011
Member Letter VE 03/12 Visa payWave Transit – Commercial Framework 16 Jan 2012
Member Letter VE 43/12 Visa payWave Transit Solutions – Variable Fare Technical Requirements 31 Jul 2012
Member Letter coming soon Visa payWave Transit Solutions – Variable Fare liability model H1 2013
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Thank you
visaeurope.com/transit
38Visa Europe Confidential. This information is not intended, and should not be construed, as an offer to sell, or as a solicitation of an offer to purchase, any securities.