MasterCard Smart Card Strategy

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MasterCard Smart Card Strategy
MasterCard International Payment Brands
Martyn Cooper Global Platform Symposium - August
2002
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MasterCard A Global Smart Card Leader
?
At Q2 2002, 125 million MasterCard?-,
Maestro?-, Mondex?-, and Clip? -branded cards had
been issued worldwide
? Already 1/10 of total MasterCard card base ?
98 members in 32 countries ? Over 50 carried
value-added applications
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Total Number of Banking Smart Cards
59
Source Celent, October 2001 Smart Cards in US
Banking Is the Chip Hip?
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Smart Card Migrations
EMV Migrating/In Progress
EMV Committed/Planned
EMV Analyzing
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Europe 2001/2002
EMV Migrating/In Progress
EMV Committed/Planned
EMV Analyzing
Iceland
Finland
Norway
Sweden
Estonian
Latvia
Denmark
Russia
Ireland
Littuania
UK
Netherlands
Germany
Belgium
Poland
Lux.
Czech Rep.
Ukraine
Slovakia
France
Austria
Switzerland
Hungary
Slovenia
Italy
Croatia
Portugal
Spain
Turkey
Greece
Israël
Indicates few banks / processors implementing
EMV, not entire country
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PROPRIETARY CONFIDENTIAL
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Asia Pacific 2001/2002
Jp
SKor
China
Tai.
India
HK
Phil.
VNam
Thai.
Thai.
Mal.
SL
Sing.
Indonesia
Australia
EMV Migrating/In Progress
NZ
EMV Committed/Planned
EMV Analyzing
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Middle East/Africa 2001/2002
Leb.
Kuw.
Egypt
SAr.
Nga.
Gha.
Moz.
Zim.
EMV Migrating/In Progress
EMV Committed/Planned
SAfr.
EMV Analyzing
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Latin America 2001/2002
Mex.
Costa Rica
Ven.
Col.
Ecuador
Peru
Brazil
Bol.
Par.
Chile
Arg.
EMV Migrating/In Progress
Uruguay
EMV Committed/Planned
EMV Analyzing
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North America 2001/2002
Key Members are both issuing and planning to
issue EMV smart cards, though no national
migration is planned.
EMV Migrating/In Progress
EMV Committed/Planned
EMV Analyzing
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OneSMART? MasterCard?

• Highly flexible umbrella strategy for helping
  members introduce smart cards in cooperation with
  MasterCard
• Based on extensive consumer research
• Reflects MasterCards approach of providing
  comprehensive support and flexibility to members
• Members can choose application set, platform,
  security strategy, chip size, and card designs

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OneSMART? MasterCard?
MasterCard Role

• Assist members in end-to-end implementation
• Opportunity identification
• Business requirements
• Process requirements
• Support
• Program development
• Program launch
• Work with industry to improve the state of the
  art
• Standards and specifications
• Maintain alliances/relationships with best in
  class vendors

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Value-Added Applications
Key To A Positive Business Case In Many Markets

• Data Storage
• Ticketing
• Couponing
• Loyalty
• Authentication (non-payment)

Enable issuer differentiation and enhanced
functionality
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Value-Added Applications
The Business Case

• Grow GDV by
• Improving acquisition, usage, retention
• Increase the accounts lifetime value
• Add new fee services
• Leverage non-payment opportunities
• Partner business process improvement
• Reduced inefficiencies or fraud

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Value-Added Applications
Developing The Business Case

• MasterCard has developed a business case tool to
  model
• Specific opportunities
• Multi-application programs
• Multi-party programs
• This model works in concert with the MasterCard
  chip payment models developed by EPI
• These models will be merged

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Platform Flexibility

• MasterCard is only payments association to
  actively support all major chip platforms
• MasterCard M/Chip available on MULTOS, JavaCard,
  and proprietary platforms

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Platform Flexibility

• MasterCard is a member of both MAOSCO and Global
  Platform
• Committed to creating a universal platform/
  infrastructure that will make it easier for
  members to issue multi-application cards

JavaCard
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Flexible Issuance Options

• Via MULTOS Issuance Partner
• Indirect relationship with MULTOS key management
  authority (KMA) via MIP
• MIP interacts with MULTOS KMA on card issuers
  behalf
• May upgrade to direct relationship if required
• Standard card issuer
• Direct relationship with the MULTOS KMA operated
  by MXI and within the Global MULTOS Domain
• Co-located MULTOS KMA
• Managed by MXI KMA on card issuers behalf
• Private domain MULTOS KMA
• Licensed by MXI (complete software/hardware
  solution)
• Operated by card issuer themselves or trusted 3rd
  party

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MasterCard/Global Platform

• MasterCard staff assigned to Global Platform
  Standing Committees and relevant working groups
• Candidate nominated to chair re-launched Business
  Requirements Working Group
• Facilitated Card and Application Management
  System (CAMS) contribution
• Evaluating additional security contributions

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MasterCard Objective
Broaden Global Platform (GP) scope to embrace all
open, industry technologies, including asymmetric
approaches

• In particular, aspects of MasterCards MULTOS
  experience
• But not necessarily prescriptive MULTOS, rather a
  class of solutions of which MULTOS is one
  
• There could be others

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Possible/Desirable Outcome
MULTOS Card Manager
Open Platform Card Manager
Open Platform Card Manager
Today
MULTOS API
Java Card API
Microsoft API
MULTOS O/S
Proprietary O/S
Microsoft O/S
Extended Global Platform Card Manager
Future
MULTOS API
Java Card API
Microsoft API
MULTOS O/S
Proprietary O/S
Microsoft O/S
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Java-tisation of MULTOS - The Goal
applet
Card specific loader
Card specific loader
Same Terminal Functionality
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Our Contribution Context

• Meaningful contribution on viable terms
• Intent for IPR terms to be normal GP practice, if
  at all possible
• Minimal pre-conditions or constraints
• At scope and level appropriate to GP
• CAMS terminology will be adopted
• GP style technical authoring style to aid and
  speed review and debate in working groups
• Timed to fit with next iteration of specifications

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