This is the first ever application of the smartphone as a payment terminal for accepting contactless payments by card regardless of the transaction value
Fiserv, of which First Data is part, and Visa have announced the first transaction using a technology called PIN on Mobile. This solution allows you to accept contactless cashless transactions using a mobile application installed on selected Samsung smartphone models. It is important that this applies to all transactions, regardless of their value. If PIN authorization is required, the paying person can enter it on the screen of the seller’s smartphone.
Applications that accept payments on mobile devices are nothing new; there are several such programs on the Polish market. Soft POS solutions are offered, among others, by companies such as Polskie ePłatności or Payarto. The disadvantage of these applications, however, is that they do not allow entering the PIN on the seller's device. This means that if the payer uses a contactless card, he can only make transactions up to PLN 50, unless he uses mobile payments like Apple Pay or Garmin Pay, which allow the authorization of large-value payments using biometrics on the payer's device.
Unfortunately, the PCI Council, an organization that develops security standards on the cashless payment market, has not yet published guidelines regarding the possibility of entering a PIN on the smartphone of the seller. Based on currently applicable regulations, this is only possible if an additional device is used to read transaction data from the paying card, the so-called dongle. First Data uses a special authorization from Visa to test the PIN on Mobile solution. Accordning to our information First Data is seeking the same permission from a rival Mastercard organization and expects to obtain it later this month.
According to today's press information, after testing the PIN on Mobile application that has just begun, the solution will be pilot implemented in Poland as the first market in the world. In addition to First Data and Visa, the project also includes a phone manufacturer, Samsung and PayCore, which provides transaction security software.
The application that allows to accept card payments on the seller's smartphone regardless of the amount of the transaction is the peak stage of Soft POS development. It will allow almost any smartphone to be turned into a payment terminal, which is an advantage that can be appreciated, e.g. by professionals. However, security concerns can be a barrier to Soft POS development. The solution requires paying customers to overcome their fears of entering personal data, such as card PIN, on the screen of the seller’s smartphone.