MasterCard International Payment Brands MasterCard Smart Card Strategy Martyn Cooper Global Platform...

MasterCard International Payment Brands

MasterCard Smart Card Strategy

Martyn CooperGlobal Platform Symposium - August 2002

Global Platform Symposium 2

At Q2 2002, 125 million MasterCard-, Maestro-, Mondex-, and Clip -branded cards had been issued worldwide

Already 1/10 of total MasterCardcard base

98 members in 32 countries Over 50% carried value-added

applications

MasterCard A Global Smart Card Leader


Total Number of Banking Smart Cards

Source: Celent, October 2001: Smart Cards in US Banking: Is the Chip Hip?

+59%

222195.72

55.5

11.6525.911.65

66.6

13.98

370

233

0

50

100

150

200

250

300

350

400

2001 2004

Bank

ing

Smar

t C

ards

(in

mill

ions

)

Europe Asia Pacific US Other Regions Total


Smart Card Migrations

EMV Migrating/In Progress

EMV Committed/Planned

EMV Analyzing

France

UK

Belgium

Por

tuga

l

Switzerland

Israël

Spain

Italy

Czech Rep.

Slovakia

Germany

Austria Hungary

Poland

Sweden

Finland

Denmark

Lux.

GreeceTurkey

RussiaIreland

Netherlands

Norway

Estonian

Latvia

Europe 2001/2002

CroatiaSlovenia

Littuania

Ukraine

Iceland

Indicates few banks / processors implementing EMV, not entire country

7PROPRIETARY & CONFIDENTIAL



EMV Analyzing


Asia Pacific 2001/2002

China

India

Australia

IndonesiaIndonesia

Thai.

HK

SKor

Thai.

Jp

Mal.

Phil.

SL

Tai.

NZ

VNam

Sing.Sing.



EMV Analyzing


Middle East/Africa 2001/2002

SAr.

Kuw.

Nga.

Leb.

Egypt

SAfr.

Moz.

Zim.

Gha.Gha.



EMV Analyzing


Latin America 2001/2002

Chile

Brazil

EcuadorCol.

Ven.

Peru

Bol.

Arg.

Uruguay

Par.

Mex.

Costa Rica



EMV Analyzing


North America 2001/2002


EMV Committed/PlannedEMV Analyzing

Key Members are both issuing and planning to issue EMV smart cards, though no national migration is planned.


OneSMART MasterCard•Highly flexible umbrella strategy for helping

members introduce smart cards in cooperation with MasterCard

– Based on extensive consumer research

– Reflects MasterCard’s approach of providing comprehensive support and flexibility to members

– Members can choose application set, platform, security strategy, chip size, and card designs


OneSMART MasterCard

• 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

MasterCard Role


Value-Added Applications

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

Key To A Positive Business Case In Many Markets

Enable issuer differentiation and enhanced functionality



•Grow GDV by– Improving acquisition, usage, retention

• Increase the account’s lifetime value•Add new fee services•Leverage non-payment opportunities

– Partner business process improvement– Reduced inefficiencies or fraud

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

Developing The Business Case


Platform Flexibility

•MasterCard is only payments association to actively support all major chip platforms

•MasterCard M/Chip™ available on MULTOS, JavaCard, and proprietary platforms


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


Flexible Issuance Options• Via ‘MULTOS Issuance Partner’

– Indirect relationship with MULTOS key management authority (KMA) via MIP

– MIP interacts with MULTOS KMA on card issuer’s 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 issuer’s behalf

• Private domain MULTOS KMA– Licensed by MXI (complete software/hardware solution)

– Operated by card issuer themselves or trusted 3rd party


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


MasterCard Objective

• In particular, aspects of MasterCard’s MULTOS experience

•But not necessarily prescriptive MULTOS, rather a class of solutions of which MULTOS is one

– There could be others

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


MULTOS O/S

MULTOS API

MULTOSCard Manager

Proprietary O/S

Java Card API

Open PlatformCard Manager

Microsoft O/S

Microsoft API

Open PlatformCard Manager

MULTOS O/S

MULTOS API

Extended Global PlatformCard Manager

Proprietary O/S

Java Card API

Microsoft O/S

Microsoft API

Today

Future

Possible/Desirable Outcome


Java-tisation of MULTOS - The Goal

applet

Load mechanism

Card specificloader

Card specificloader

Same Terminal Functionality


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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