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February 11, 2016updated 04 Sep 2016 10:19pm

Visa Europe expands tokenisation to boost mobile payment app security

News: Financial institutions can focus on functionality and performance.

By Alexander Sword

Visa Europe has widened its support for mobile payments with an expansion of its tokenisation system.

The expansion of the Visa Europe Payment Tokenisation Service (VEPTS) will allow financial institutions to integrate tokenisation with some of their services, including where payment credentials are stored in the cloud to be used by an app. This could include on mobile phones as well as other connected devices such as wearables.

It will also be used by internet browser-based wallets and retailer-specific checkout offerings such as Visa Checkout.

It will also allow it to be used in card on file payment options that are commonly used by online retailers and merchants.

"People throughout Europe are encountering innovative new technologies that offer fast and frictionless ways to pay wherever, whenever and on whatever device they choose," said Sandra Alzetta, Executive Director Product Enablement for Visa Europe.

Tokenisation substitutes a series of numbers for customers’ actual account information so that when token data is stored, the sensitive information is not exposed.

Visa’s aim is that by dealing with the security elements of the payments space, the financial companies would be able to focus more on functionality and service.

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"By expanding our service to make tokenisation available to our client banks through a number of new technology partners, consumers will have access to all manner of fantastic new payment experiences accessible through their mobile phones, tablets and all manner of other ‘connected’ devices," Alzetta added.

Contactless cards in the UK have seen rapid adoption; the value of transactions rose 560 percent in the year to July 2015. The year to July 2014 saw a 373 percent increase, showing that adoption is actually accelerating.

In the 2015 global index for mobile payment use the UK moved up three places in usage to fourth behind Finland, Singapore and the US.

Apple Pay arrived in the UK in July 2015, while Samsung Pay was first launched in South Korea on August 20 and in the U.S. on September 28 but has not seen a UK launch.

Google’s generic mobile payments solution for Android, Android Pay, still does not have an official UK release data slated.

When it comes to mobile payments, the challenge is not necessarily security but ensuring that the user experience is adequate to make people want to use it.

Verifone hopes to bridge the customer experience gap with its Engage platform, launched in December 2015 which turns the payment terminal into a computer itself that can interact more profoundly with your phone.

The payment terminal itself is connected to the internet and can be synchronised with other channels as well as the consumer’s own mobile device.

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