From Visa U.S.A.
Working closely with industry leaders, Visa U.S.A.
announces a first-time initiative to make it easier for U.S. merchants
to accept smart card payments in stores nationwide. Research shows consumers
are seeking more convenience and security in the ways they pay, and
smart cards are poised to deliver new types of services that save consumers
time and increase the security of their transactions. As a critical
first step in providing smart card payments, Visa has brought together
key industry players to lay the roadmap for building a smart card infrastructure
in the United States.
Through this initiative, Visa, along with technology,
financial services, and industry partners, are working to streamline
the steps that merchants and their technology vendors need to take to
accept smart cards at their locations. The effort has already achieved
significant milestones: for example, now bankcard processors supporting
80 percent of Visa's card volume can now process Visa smart card based
payment transactions. In addition, Visa is working with leading point-of-sale
(POS) device suppliers to provide the hardware and software that merchants
need to accept smart card payments. As a result, Visa anticipates that
smart card acceptance and usage will significantly increase in the U.S.
"While centering early smart card efforts around
the Internet, Visa built its platform, æsmart Visa', to bridge the gap
between traditional commerce and e-commerce," said Patrick Gauthier,
senior vice president, smart card applications, Visa U.S.A. "Through
this initiative, Visa Member financial institutions and partner merchants
are now able to offer 'bricks and clicks' smart card services. This
is an important step for fulfilling with the consumer the promise of
simplicity, security and value that smart cards offer. Ultimately, it
means Visa is offering a better consumer experience for how they pay
for goods and services."
This effort highlights solutions from vendors such
as Hypercom, Ingenico and VeriFone, a division of Hewlett-Packard. Merchants
are planning to install this new POS infrastructure including these
solutions, as well as begin accepting smart card-based payments at physical
locations, by as early as the end of the year. Merchants have recently
moved to update their terminals, and POS hardware and software. Many
merchants have indicated that smart card acceptance is part of their
overall plans.
"Merchants want to offer consumers the capability
to use smart cards because they are a tool of added functionality and
convenience," said T. Jack Williams, senior vice president, National
Processing Company (NPC). "However, merchants need the infrastructure
in place to do so. Visa's initiative provides an infrastructure built
specifically for smart card acceptance."
Through this effort, Visa has brought together leading
companies in payments hardware, software and systems:
1. Three top POS device suppliers have devices to
accept smart card-based payments. By obtaining Europay, MasterCard,
Visa (EMV) level 1 and level 2 approval, these vendors' device models
ensure global interoperability when accepting EMV-compliant smart cards.
EMV is the global standard for smart cards and acceptance devices.
2. Most Visa card processors now have host system
level Visa Smart Credit/Debit (VSDC) support capability. Bankcard processors
supporting 80 percent of Visa's U.S. card volume can now identify smart
card-based versus magnetic stripe read payment transactions.
3. Terminal software applications are available for
late 2001 delivery. Several key merchant payment processors, including
Vital Processing Services ("Vital"), NPC, and First Data Merchant
Services (FDMS), will be able to offer smart card acceptance applications
on Hypercom and VeriFone terminal models.
"This is the first broad-scale approach to laying
a U.S. smart card acceptance infrastructure," said Michael Cottrell,
vice president of market strategies, Vital Processing Services. "Certifying
terminal applications is a critical step in facilitating merchant and
consumer usage of smart cards in the U.S. This initiative brings together
the key players to enable new payment choices for consumers."
"Given the complexity and scope of the effort
needed to make smart card acceptance a reality in the U.S., many industry
participants will have to move in concert with Visa," said Steve
Van Fleet, senior vice president, product development, FDMS. "More
importantly, though, we will be bringing applications, such as loyalty
and payment, to the merchant community in the short term that will provide
real value to merchants, consumers and issuers alike."
Visa works on behalf of its Member financial institutions,
merchants and consumers to continually deliver better ways to pay. Smart
Visa, for example, allows consumers to access Web-delivered applications,
online payments security and shopping enhancements such as loyalty points,
as well as information storage capabilities. Visa's vision is that smart
cards will continue to add new levels of convenience to consumers' everyday
lives by, for example, functioning as electronic keys for a home, office
or car, or offer payments services through a mobile phone, PC or personal
digital assistant (PDA).
Visa has a history of bringing together different
industry players to set standards and develop solutions to ease the
broad-scale adoption of new payment technologies that generate loyalty
and increase operating efficiencies for banks, merchants and consumers.
It took the leadership role by contributing the Open Platform specifications
to the Global Platform Organization for future smart card development
and enhancements. Visa and other card organizations base their smart
card products on the Open Platform today. Global Platform's goal is
to reduce barriers that hinder the growth of cross-industry, multi-application
smart cards while continuing to allow smart card issuers the freedom
to choose from a variety of cards, terminals and back-end systems.