Monday, September 21, 2009

Senator Proposes Use of Internet Gambling Revenue to Help Fund Health Care Reform

WASHINGTON, Sept. 21 /PIN Payments News Blog/ -- An increased focus on the benefits of Internet gambling regulation are expected as the Senate Finance Committee considers a proposal introduced on Saturday to use Internet gambling revenue to offset the costs of health care reform. The amendment offered by Senator Ron Wyden (D-OR) would dedicate Internet gambling tax revenue generated through implementation of the currently pending Internet Regulation, Consumer Protection and Enforcement Act (H.R. 2267) to increase low-income subsidies provided through the America's Healthy Future Act of 2009. A PricewaterhouseCoopers analysis shows that collecting taxes on regulated Internet gambling would allow the U.S. to capture up to $62.7 billion over the next decade.

"We applaud Senator Wyden's proposal to collect and put to good use tens of billions in Internet gambling revenue that would otherwise be lost in the underground marketplace," said Michael Waxman, spokesperson for the Safe and Secure Internet Gambling Initiative. "The Senate Finance Committee should approve the resolution, finally putting to an end a failed prohibition on Internet gambling that leaves Americans unprotected and unlicensed offshore operators as the only beneficiary in a thriving marketplace."

The Internet Gambling Regulation, Consumer Protection and Enforcement Act of 2009 (H.R. 2267), introduced in May by House Committee on Financial Services Chairman Barney Frank (D-MA), would establish a framework to permit licensed gambling operators to accept wagers from individuals in the U.S. The legislation mandates a number of significant consumer protections including safeguards against compulsive and underage gambling, money laundering, fraud and identify theft. Additional provisions in the legislation reinforce the rights of each state to determine whether to allow Internet gambling activity for people accessing the Internet within the state and to apply other restrictions on the activity as determined necessary.

A companion to Chairman Frank's legislation introduced by Rep. Jim McDermott (D-WA), the Internet Gambling Regulation and Tax Enforcement Act (H.R. 2268), would raise revenue for the U.S. Treasury primarily through ensuring that applicable individual taxes, corporate taxes and license fees on regulated Internet gambling activities are collected. Without this legislation, this revenue will remain uncollected while millions of Americans gamble online without consumer protections.

About Safe and Secure Internet Gambling Initiative

The Safe and Secure Internet Gambling Initiative promotes the freedom of individuals to gamble online with the proper safeguards to protect consumers and ensure the integrity of financial transactions. For more information on the Initiative, please visit The Web site provides a means by which individuals can register support for regulated Internet gambling with their elected representatives.

SOURCE Safe and Secure Internet Gambling Initiative
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Keeping Credit Cards Secure: Washington Times

"I think the U.S. is targeted because there's more and wealthier people on the Internet and we're more active in e-commerce," Avivah Litan - Distinguished Analyst at Gartner Research - Quoted in Washington Times 

Editor's Food for Thought:  If the U.S. did bite the bullet and decide to spend $8 Billion Dollars to switch over to Chip and PIN it is NOT going to reduce eCommerce Fraud one iota 

At least not until we start swiping the card itself.  (Replacing the Card Not Present Environment with a Card Present one.)  As long as there is a Card Not Present" environment, there will be fraud, because fraud, like water, finds the path of least resistance.   The path we are on (typing vs. swiping) makes it easy for the bad guys to steal our personal data and wreak havoc.   Wake up and smell the coffee!

Until we start "swiping our cards" it would make NO DIFFERENCE WHATSOEVER, in terms of eCommerce Fraud, whether the cards that banks issue are Contactless, Chip and PIN, Magnetic Stripe...or anything else.  

What difference does it make whether there is an integrated circuit built into the card if we don't swipe the card? It wouldn't matter if a card had the users DNA embedded onto the card if the card is not read.  Until  consumers stop entering their credit/debit card number by typing  it into a box on a website, there will be fraud.  Where am I wrong here?  Hint:  Nowhere!

Anyway, I thought  it important to make the distinction prior to you reading the Washington Times article below.  In regards to the "brick and mortar" space, I agree that switching over to Chip and PIN would greatly reduce fraud created by cloning magnetic stripe cards, but, again, until we start swiping and stop typing,  it won't matter if the card is Smart, Dumb, a Kindergartner or Einstein.

There is the only one "Smart vs. Dumb" argument when it comes to transacting on the web.   What's dumb is typing/entering our card information into a browser environment.   What's Smart is swiping the card in order to instantaneously "encrypt" the card information keeping it from the bad guys.  (in fact, it's such a simple concept, I got a Kinder-Gartner to draw it up for you...she's right!)

By the way, HomeATM's PCI 2.x certified personal point of sale terminal would not only enable consumers to swipe their magnetic stripe card, but we also have an EMV version which would enable consumers to swipe smart cards. 

So let's not confuse eCommerce transactions with brick and mortar.  In the brick and mortar world the card is swiped.  Until we convert the "card not present" methodology currently relied on for Internet Financial Transactions, into a "card present" environment, by providing consumers with a personal card reader and PIN Entry Device, the point is moot.

Here's the Washington Times Story: (excerpts only)

Keeping credit cards secure

By William Ehart

Next-generation security for debit and credit cards is on hold in the United States as banks and retailers argue over who should pay for a new system. Americans continue to use plastic for more and more transactions, at checkout counters, over the phone and on the Internet, despite increasingly frequent security breaches.

But the banking industry's losses have not been large enough to spur a consensus on financing the estimated $8 billion cost of moving beyond the aging magnetic-stripe technology now in use, analysts and consumer advocates say. "Up until now, it hasn't been that necessary, but in the last few years, hundreds of millions of cards have been compromised," said Avivah Litan, a Gartner Research analyst.

"The question is, how much more fraud do the banks want to tolerate?"

"The old formula that a lot of them are still using is, 'What is the cost of fraud or loss versus the cost of putting in a new system,' and it's the wrong formula.

"You have to consider what is your fraud loss, what is the cost of losing your customers, the decline of your stock price, what's the cost of your fraud resolution units and the loss of your reputation? - Linda Foley - Founder of Identity Theft Resource Center in San Diego

The industry is tight-lipped on fraud losses, although they are known to be in the billions each year.

"They don't ever reveal the exact numbers, so we don't know," said Ms. Litan. "All we know is there are a lot of breaches and there's a lot of money being spent on security in the wrong places." The "chip and PIN" system used for payment cards in much of the world greatly reduces the risk from cyberthieves. (Editor's Note: Again, it would NOT reduce "card not present" fraud until we stop typing)

Although this smart-card system isn't foolproof, in most cases a thief would need to physically possess your card in order to withdraw cash or make an unauthorized charge. With magnetic-stripe technology, hackers can reprogram a dummy card with your account information. (Editor's Note: A cyberthief would NOT need to physically possess your card until the card industry mandates a "card present" environment for the web...i.e. "Swipe...Don't Type!)

A microchip embedded in each smart card contains the user's account information, and some transactions also require a PIN number. The "chip and PIN" system is used in Europe, Mexico and elsewhere, Ms. Litan said. It will be rolled out in Canada next month. Everyone along the electronic-payments food chain agrees that more security is needed, from the banks that issue the cards to the retailers that accept them to the payment processors whose networks transmit essential information.

It's just that retailers think the banks should pay more and that banks think the retailers and payment processors should pay more.

Every consumer would need new cards — by some estimates, Americans hold more than a billion of them. Even more daunting, every card-swipe machine in the country would need to be replaced. Nagraj Seshadri, senior product marketing manager at security company Sophos, said it cost $1.6 billion to roll out "chip and PIN" in Britain. Since the U.S. poulation of 300 million is five times greater, it could cost $8 billion to do the same here, he said.

Yet the value of purchases made in the United States with Visa Inc.'s debit and credit cards alone exceeded $1.6 trillion last year. And this country is a big bull's-eye
for hackers around the world.

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Gartner: Security Software Market will Total $14.5 Billion in 2009

The worldwide security software market will total $14.5 billion in 2009, an 8% increase from 2008, according to Gartner. In 2008, it grew at 19 per cent, and Gartner anticipates the market to grow 13 per cent in 2010 as revenue will total $16.3 billion.

In Europe, the security software market will total €3.2 billion in 2009, representing 7% growth from 2008.

“Although the worldwide security software market is affected by the economic downturn, the growth will continue to be strong in 2009 as security remains a critical area where drastic cuts cannot be afforded,” said Ruggero Contu, principal research analyst at Gartner. “In the medium term, the greatest growth opportunities will come from software as a service (SaaS), appliance based offering and small and medium businesses (SMBs), which are in security catch-up mode compared with large companies and therefore spend a higher percentage of their budgets on security.”

In 2009, consumer security will remain the largest segment (in terms of total software revenue) in the security software market, representing 25 per cent of the total market. Gartner estimates it will account for $3.6 billion, growing 4 per cent in 2009. The enterprise security software market formed by a number of segments such as endpoint protection platform, email security boundary and user provisioning is predicted to account for $10.9 billion, reaching 9 per cent growth in 2009.

Continue Reading at 

Additional information is available in the Gartner report "Market Trends: Security Markets, Worldwide, 2007-2013." 

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VerifySmart's New Card Fraud Prevention and Detection Technology Targets Multi-Billion Dollar Financial Fraud Loss Market; Lets Consumers Off The Liability Hook

TAGUIG, Metro Manila, Philippines, Sept. 21 /PIN Payments News Blog/ - VerifySmart(TM) Corp. (VSMR: OTCBB): VerifySmart, a global leader in secure and fraud free payment processing services, introduces a new 'no-fault' fraud protection solution technology (the "Technology") for credit and debit card holding consumers, and unprecedented fraud detection and prevention protocols for merchants and financial institutions.

VerifySmart's Technology comes at a watershed moment in the global financial community, when astronomical credit and debit card fraud losses make headlines with alarming regularity. While most financial institutions are hesitant to post actual credit and debit card fraud loss numbers, the figures are staggering as far back as 2005, when an FBI report indicated that credit card fraud represented the majority of the $315 billion US financial fraud loss for that year. A recent European study reported that more than 22 million adults fell victim to credit card fraud in 2006.

Financial institutions and consumers alike hoped that the recently introduced, so-called Chip and PIN technology, first introduced in the UK, would drastically reduce credit and debit card fraud, but a 2008 APACS (Association of Payment Clearing Services) report indicates a loss prevention gain of just 0.02%, after Chip and PIN technology was adopted (0.14% fraud losses as a percentage of card turnover pre Chip and PIN, versus 0.12% post Chip and PIN).

An unwelcome sidebar disadvantage of Chip and PIN, VISA, and other currently available so-called credit and debit card fraud prevention and detection technologies is the assumption of 'total card holder liability' made by many financial institutions. That is, the widespread practice, by banks and other financial institutions, of assigning loss liability to the cardholder on the assumption that the cardholder either wrote down or otherwise disclosed their PIN number and are therefore liable and accountable for the loss. The apparent growing lack of faith in Chip and PIN and other card fraud prevention technologies is evident in the fine print.

One of Canada's oldest banks introduces its faith in the new Pin and CHIP technology policy to credit card customers in writing as follows: "If a cardholder fails to comply with any obligation in the section entitled personal identification number (PIN) and someone other than the cardholder makes any PIN-based transactions on the Visa account, the cardholder will be liable for those transactions and any interest, fees and losses incurred...." The same national bank outlines debit card liability in their cardholder agreement: ""Contributing to unauthorized use: if someone uses your bank card or PIN without your authority but your actions (or inaction) contributed to that unauthorized use, you are responsible for all losses...."

All popular and available credit and debit card fraud prevention and detection systems have a single element in common, and that is the single element. Once a credit or debit card has been stolen, a seasoned criminal or fraud expert can quite easily breach required securities, assume an identity, and successfully execute several commercial transactions - at the expense of the card holder (fraud and theft insurance notwithstanding).

VerifySmart's Technology adds a second, hacker-safe layer of protection, and several levels of reassurance for consumers and financial institutions alike, by involving a second element, and with that second element, a secure 'double-check' to the transaction process.

How VerifySmart(TM) Technology Works

In smart contrast to Chip and PIN, VerifySmart(TM) provides a complete solution to lost or stolen cards, identity theft and cloned cards while putting control of the transactions directly in the hands of the card owner. VerifySmart(TM) has developed key technology that is simple yet effective. The cornerstone is an authentication model that decouples the verification and PIN process from the physical card or transaction medium offering the industry a new and proven fraud reduction mechanism.

VerifySmart's key benefit is a two-part authentication whereby a second source (mobile phone or PDA and a PIN) of identification which cannot be forged, is required to complete the transaction.

VerifySmart's credit and debit card fraud detection and prevention technology is patent and patent-pending (PCT approved) in 29 countries ranked by strategic importance and wireless penetration rates.

In addition, using VerifySmart's credit and debit card fraud detection and prevention technology, card transactions and other applications, such as internet transactions can be verified without requiring the banks and merchants to invest in new equipment and without major modifications to legacy systems.

VerifySmart(TM) Technology provides for verification through the end client's mobile device, such as a cell phone, with the transaction completely under the control of the card holder at all times. The process is simple and secure, uses technology that consumers and businesses alike are familiar with, does not require new hardware and only takes seconds to complete. VerifySmart's methodology uses a two factor system to verify both the transaction and unique owner credentials in real time creating a security model that is effectively impossible to breach.

VerifySmart's debit and credit card processing occurs in less than ten seconds, as follows:
- The merchant (or ATM machine) swipes the customer's card in the normal manner.
- The debit signal transmits to the bank but before entering the bank's
system it is directed by VerifySmart(TM) to the card holder's mobile
- The card holder's mobile device is unique as to its phone number and
identity code so the transmission is secure to that one device;
- The card holder receives a cell phone message that a transaction is in
progress with their card for a named merchant and asks for
- The card holder then enters their unique PIN number to authorize the
transaction or refuses the transaction (if they do not acknowledge
with their PIN the transaction will fail);
- Upon receiving the authentication signal from the owner, the
VerifySmart(TM) system allows the signal to complete its journey to
the bank and the merchant receives the 'all clear'.

About VerifySmart(TM)

VerifySmart(TM) Inc designed and developed a Proprietary Hardware/Software Solution that solves Credit/Debit Card fraud by using two Factor Authentication. The Company's Core Technology is designed to meet the needs of the Security challenged Transaction Processing Industry. Present day solutions, such as Verified by Visa, Chip and Pin and CVV Code (all which can be compromised) have not reduced payment card fraud by any significant factor. The VerifySmart(TM) solution has reduced fraud to zero in earlier production pilots. the Company's proven and highly scalable solution is gaining worldwide attention and placing VerifySmart(TM) at the forefront of the fraud prevention revolution

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Device Fingerprinting Worse than Passwords?

Are we going backwards instead of forwards in our fight against cybercrime?  Passwords are bad enough, but a study shows that people falsely believe that device fingerprinting will protect them.

I've been lamenting about the inherent weaknesses in "password" protection for well over 18 months.  Consumers know it is not safe.  But what they don't know, is that a possible replacement for passwords, something called "device fingerprinting" is just as lame. 

So I will LAMEnet some more...

Prior to bringing you the following article/study, let me provide you with  two from Symantec and another from Avivah Litan, distinguished analyst at  Gartner Research. 

Then ask yourself.  If the problem is the browser, why introduce a so-called solution which relies on the browser?  Are we taking two steps backwards when it comes to online security?  Sure seems that way.   I think it's been proven that you don't plug a hole in a dyke by sticking your finger in it. 

Again, in order to provide a secure environment, financial transactions MUST be conducted outside the browser space.  It is NOT a recommendation.  It is FACT.  Read these two quotes, read the story and then take two steps backwards and see the forest through the trees...

"The truth is that 'fingerprint' security technology is no longer effective," said Rowan Trollope, senior vice president of product development at Symantec.   "The bad guys figured out how to get around our technology."

Speaking of device fingerprinting, Avivah Litan, a Gartner VP and analyst who focuses on financial fraud...said "the technology has's not foolproof at all," "If a cyber criminal takes over

your browser, it won't work." 

Editor's Note:  Got it?'s the latest word on how we can secure online transactions!

Users Prefer Device Fingerprinting to Passwords

Study finds 70 percent of respondents say they'd be willing to have their PCs and mobile devices authenticated by an online merchant before completing a transaction.

The latest data protection and information security survey conducted by the independent Ponemon Institute suggests that consumers would be willing to let Big Brother encroach a bit on their individual computing devices in exchange for more online security and lot less memorization of pesky user names and passwords.

Of the 551 participants who responded the Traverse City, Mich.-based researcher's online survey, 70 percent said they'd be willing to have their computers authenticated by an online merchant before purchases are completed and 75 percent of those surveyed said that computer authentication is preferred because it's more convenient than remembering passwords or answering pre-selected questions.

According to a 2007 password study by Microsoft, the average person has 6.5 Web passwords, each of which is shared across almost four different Web site. The study also found that each user has about 25 accounts that require passwords and he or she types an average of eight passwords a day.

If this particular study and it's relatively small sample size is indicative of how the majority of consumers feel, so-called device fingerprinting software and technology developed by the likes of Los Altos, Calif.-based ThreatMetrix will soon find a much larger market with e-tailers, online payment processors and even social networking and e-dating sites.

Editor's Note:  Take a step backwards here...look up...see the forest?

"Actually, I did find the responses a little surprising," said Larry Ponemon, chairman and founder of the Ponemon Institute. "The responses were overwhelmingly positive and it's clear people are becoming more comfortable with technology that can authenticate their machines."

The idea of allowing a third-party Web site to use a software that would then report back the IP address, browser and physical location of a PC or mobile device still strikes some as an invasion of privacy.  However, the notion of divulging personal information such as a mother's maiden name or the last four numbers of a social security number apparently bothers Internet users even more.

"The thing I've learned over a number of years is that timing is everything," said Tom Grubb, vice president of marketing at ThreatMetrix. "I really feel like it's the right time for this technology.

The timing is right?  The only thing I see good timing for is to review Symantec's take on device fingerprinting one-more-time...

"The truth is that 'fingerprint' security technology is no longer effective," said Rowan Trollope, senior vice president of product development at Symantec.  "The bad guys figured out how to get around our technology."

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Typhone Awarded Electronic Transaction Card Patent

PORTLAND, Ore.--PIN Payments Blog-- Tyfone (, a global provider 
of mobile financial services infrastructure and fully integrated mobile NFC payments
/secure transaction capabilities, today announced the company was awarded a second
patent for its innovations in smart card-based electronic wallet technology.

This newest patent, US 7,581,678, is entitled "Electronic Transaction Card."

Using time-varying magnetic fields, Tyfone`s patented technology enables the use of a memory card as an electronic wallet and/or the
ability to use that memory card for the secure transmission of financial information. This groundbreaking technology is used in the
company`s u4ia® (euphoria) Mobile Financial Services platform, which completed successful beta testing in June of this year.

In the growing contactless payment marketplace, Tyfone`s patented technologies and u4ia secure memory card platform enable a
Trusted Service Manager (TSM) to bring scale to the ecosystem by enabling existing market-deployed handsets to
become NFC ready. This leads to significant benefits to consumers and the key stakeholders such as banks, transportation
companies, mobile operators and merchants, without change to the current ecosystem and without incurring significant cost to enable it.

Unlike other software-only technologies that refer to their application as an electronic wallet, Tyfone`s platform includes a neutral secure
element -- thereby making it a true electronic container or "wallet." This solution allows a TSM to securely manage different consumer credit,
debit, transportation and pre-paid accounts for use in a wide range of payment and other secure transactions.

A key application for Tyfone`s newly patented technology is using SideTapTM to conduct a contactless payment transaction. Using SideTap,
consumers purchase goods at point of sale simply by tapping their mobile device at point of sale.

"To Tyfone, this patent is the culmination of tireless work developing a neutral solution not only as a viable implementation of NFC that
can be broadly used today, but also as a truly game-changing technology," said Dr. Siva Narendra, chief technology officer at Tyfone.
"As was demonstrated when initial testing was completed with the key stakeholders in the NFC value chain, Tyfone`s newly patented
technology brings us one step closer to a ubiquitous contactless payment reality. Tyfone`s secure memory card technology is out of the
R&D lab, has been tried and tested and is ready for the next stage in evolving the stakeholders` existing business models into new
revenue opportunities."

"Enabling near field communications without requiring design changes to the handset is the fastest way to proliferate contactless
applications," said Patrick Gauthier, who launched Visa Paywave and is now CEO of SMC Advisors, a management consulting firm focused
on emerging payments, mobile and e-commerce businesses. "Tyfone`s technology is critical to jump start NFC by providing a packaging that
is familiar to the consumers, delivering a neutral secure element that is appropriate for banks and service providers, and enabling a new class
of use cases that can drive revenue for operators."

About Tyfone:

Tyfone connects money and mobility via a highly secure, scalable and flexible Mobile Financial Services (MFS) infrastructure thaTt is tailored
to meet the evolving needs of mobile network operators, transportation agencies, retailers and financial institutions. With its complete
MFS platform and global alliance partners, Tyfone is uniquely qualified to deliver issuer-centric turnkey solutions with fully integrated
contactless payments capabilities. To discover why Tyfone is becoming the partner of choice for MFS technologies to many of the
world`s leading organizations, please visit

Carol Grunberg, +1 503-546-9364
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Community Banks Focusing on Secure Payments

Washington, D.C., -PIN Payments News Blog- Community banks are continuing to invest in payments-related products, according to a nationwide community bank payments survey released today by the Independent Community Bankers of America (ICBA).

The 2009 ICBA Community Bank Payments Survey ( ), conducted every two years, revealed that 52 percent of community banks increased payments-related spending, while only 11 percent decreased spending.

The survey also revealed that 62 percent of community banks offer merchant remote deposit capture (RDC), up 41 percent since 2007; debit cards continue to be the dominant consumer-payments vehicle for community banks; and debit card and check fraud are of great to concern to community banks.

"The 2009 ICBA Community Bank Payments Survey shows that, even during these challenging economic times, community banks ( ) are increasing their investment in payments products and services that enable customers to execute secure banking transactions anywhere at any time," said Viveca Ware, ICBA senior vice president of payments and technology policy.

"It's evident that most community banks now understand the benefits their investments in payment technology bring to operational efficiency for both the bank and the customer."

The number of community banks that offer merchant remote deposit capture is expected to increase to 78 percent by 2011. RDC adoption rates are strongest among the largest community banks, with 97 percent of those with more than $500 million in assets offering merchant RDC versus 32 percent of community banks with assets less than $100 million.

While debit cards ranked as the most important payments vehicle, and checks were the second most important, the outside fraud associated with both has been a challenge for community banks, the survey showed.

Debit cards have been hit particularly hard, with 91 percent of survey respondents citing the need to reissue cards due to fraud, while 78 percent said they experienced a monetary fraud loss. Check fraud continues to be a problem as well, with 56 percent of community banks experiencing monetary fraud losses last year.

"While community banks such as mine are heavily committed to protecting our customers and our bottom lines, fraudsters continue to be just as committed to exploiting banking customers," said John Buhrmaster, chairman of the ICBA Payments and Technology Committee and president of 1st National Bank of Scotia, N.Y. "Payments fraud risk can be mitigated, but not without effort or expense."

Other key findings from the 2009 ICBA Community Bank Payments Survey include:

  • Online bill payment is becoming more prevalent across the community banking sector. All banks over $250 million in assets (99 percent) offer this service, while smaller community banks offering the service (74 percent) are rapidly closing the gap.

  • Community banks still consider checks the most important business payments product, followed by ACH origination, cash management, bill payment and payment-card merchant processing.

  • Six percent of community banks offer mobile banking services today, with 27 percent planning to increase their technology spending in this area by 2011.

  • Community banks are close to implementing all-image check processing. While 82 percent of community banks currently receive their cash letters electronically, an additional 9 percent plan to do so next year.

The survey was conducted from June 1-26, 2009, and included 43 questions with responses from 909 community banks with asset sizes from under $100 million to more than $500 million. For more information, visit .

About ICBA

The Independent Community Bankers of America ( ), the nation's voice for community banks, represents nearly 5,000 community banks of all sizes and charter types throughout the United States and is dedicated exclusively to representing the interests of the community banking industry and the communities and customers we serve. For more information, visit .

Source: Company press release.

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NAB: "Mobile Payments Not in the Cards"

In an article written by Suzanne Tindal, for ZDnet Australia, she reports that National Australian Bank will deploy over 2500 Contactless Terminals to merchants by Christmas, but has pulled the plug on a mobile payments platform that relied on a software download to the phones SIM.

NAB rolls out contactless terminals

Suzanne Tindal,
- September 21 2009

National Australia Bank has announced that it will roll out systems to over 500 Melbourne merchants this month, which will enable them to take customers' payment when they hold their cards up to a reader, but has stopped developing technology for payments via mobile phone.

"The bank had also been trialling contactless payments via mobile phone, made possible by downloading a software application to a phone SIM. However, despite positive results from a three-month trial of this technology which found that 90 per cent of participants were happy making payments using the mobile technology, the bank said mobile payments weren't on the cards.

"Mobile payments rely upon card issuing companies and telcos positioning product together," a spokesperson for the bank said. "We are not pursuing development of this at this point in time."

Editor's Note:  Sounds like they read Javelin's Report (see previous post) on contactless/mobile payments where they stated:

"The contactless payments ecosystem is presently a series of “islands” with little-to-no mutual realization of value among the various constituents. The report indicated that the success of contactless solutions depends on some disruptive factor or wide-scale deployment that bridges the gaps and allows for value creation among all constituents that connects the islands. 

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Javelin: Contactless Payments Have Little-to-No-Mutual Realization of Value

San Francisco, -PIN Payments News Blog– Javelin Strategy & Research ( ) today released a report revealing that the contactless payments ecosystem is presently a series of “islands” with little-to-no mutual realization of value among the various constituents. The report indicates that the success of contactless solutions depends on some disruptive factor or wide-scale deployment that bridges the gaps and allows for value creation among all constituents that connects the islands.

The Javelin report, Contactless/Mobile Payments Ecosystem: Solutions Must Bridge Islands of Value to End Market Stagnation, also reveals that until this bridging occurs, Near Field Communication (NFC) and the evolution of mobile payments will flounder in the U.S. market.

“Efforts to deploy contactless and mobile payments solutions have suffered from conflicting value propositions among various constituents, specifically merchants, payment networks, card-issuing financial institutions, and wireless carriers,” said James Van Dyke, President & Founder. “But companies such as Vivotech and newcomer Zenius are seeking to build solutions that bridge the gaps in value among the constituents. Consumer awareness and behavior changes are also necessary.”

Key Findings of the Javelin Strategy & Research Report:
  • Smartphone ownership will be a key driver in consumer adoption of more robust mobile activity, including mobile payments. (For more on smartphone and iPhone usage, please refer to our 2009 Mobile-Banking and Smartphone Forecast Report.)

  • Current smartphone owners show a much higher propensity to use contactless cards and are more likely to extend this into mobile payments usage.

  • The tipping point for wide-scale mobile payment deployments will sync with the growth of selected smartphones and the congruence of value for each ecosystem player.

  • As ecosystem players realize the value of NFC beyond the payments, the path to value from large-scale deployments of NFC solutions will become clearer.

  • Wireless offers with higher uptakes will lead to a greater likelihood that customers will engage in mobile payment activities

“Finding the right base of consumers that will drive contactless usage and make the leap to early adoption of mobile payments is an integral part of widespread deployment,” said Mary Monahan, Research Director & Managing Partner. “Several population segments show propensity to use contactless and mobile payments – including mobile bankers, smartphone owners and tech-savvy consumers. In-depth information on these segments will enable all industry players to better understand their individual value proposition and their position in the ecosystem.”

To arrange an interview with Mr. Van Dyke or Ms. Monahan and/or view research on this topic or a similar topic (available to qualified members of the press), please contact Crystal Mendoza at +1.925.225.9100 ext. 35 or .

About Javelin Strategy & Research

Javelin provides superior direction on key facts and forces that materially determine the success of customer-facing financial services, payments and security initiatives. Our advantages are rigorous process, independent position, and expert people. For more information about this or other Javelin reports, please visit or contact Elizabeth Travers at (925) 225-9100 ext. 31 or .

Source: Company press release.

$3 Million Raise for Mocapay

Denver, -PIN Payments News Blog- Mocapay, a leader in mobile gift, loyalty, and marketing, is proud to announce today that they have closed $3.0 million in funding from Spartan Mobile, Lacuna and other investors.

“We are very excited to have Spartan Mobile as the lead investor in this round and we look forward to their active role in helping to guide the Company,” said Kevin Grieve, CEO of Mocapay. “To close a funding round in this economic environment is a testament to the momentum of our business and the viability of our business strategy. We continue to see market interest in our mobile commerce services and our ability to support a new-to-market mobile payments and marketing product.”

Currently, Mocapay provides merchants’ the capability to mobile-enable their gift and loyalty programs which allows consumers to transact at the point-of-sale, access their account balance and transaction history, find the nearest merchant location accepting mobile gift and loyalty, and reload their gift account, all from their mobile phone.

In addition, Mocapay customers can take advantage of the Gift-A-Friend application, which enables consumers to send mobile gift accounts to their friends and family directly to their mobile phone from the Mocapay website ( ).

Proceeds from the funding will go towards supporting new customer implementations, expanding business development efforts, and developing additional enhancements to the mobile commerce platform, for both payments and marketing services.

“We look forward to the opportunity to help Mocapay grow and establish themselves as the leader in the mobile payments and marketing space,” says Chris Martin, investment manager of Spartan Mobile. “We see the tremendous value and potential of Mocapay, as they continue to expand their footprint among merchants’ gift, loyalty, and marketing programs.”

About Mocapay ( )

Mocapay provides the only mobile commerce platform that supports integrated mobile payments, marketing and distribution at point-of-sale. Mocapay delivers unequaled direct marketing opportunities and customer loyalty to merchants while providing consumers with the unprecedented ability to transact simply and securely with their mobile device and receive real-time promotions from their favorite retailers.

About Spartan Mobile

Spartan Mobile is an investment fund out of Dallas, TX that has invested in the mobile space since 2005, specializing in mobile marketing, information and promotions. Spartan, backed by the Headington Group, provides capital, manpower, and takes an active role in helping to guide its companies to continued success.

About Lacuna ( )

The Lacuna Venture Fund is a pioneer in the concept of Gap Capital, which helps early-stage companies negotiate the gap between product innovation and marketplace adoption. The company provides financial capital and go-to-market expertise to accelerate the success of promising entrepreneurial companies.

Source: Company press release.

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