Smartphones as payment devices

Financial transactions are speeding up. Transfer times have already become much shorter in the past years. Diverse initiatives on the European level will also promote and challenge this, for example Instant Payments, which means to implement euro payments within ten seconds in Europe by the end of the year – 24 hours a day, 365 days a year. Although these payments are currently limited to € 15,000, the trend towards fast transactions will prevail over time. In the future, money could be sent to the other side of the world in real-time, with the keywords being “real time processing”. Payment methods will differentiate from the usual paying by cash, invoice or swiping a card. The tools to initiate transactions will therefore change, with new trends just about to develop.

Smartphones instead of payment cards

Among all the possible gadgets to provide payment function, the mobile phone is probably the most obvious payment device to come. Nowadays people spend plenty of time using their smartphones. For instance, according to a survey conducted by T-mobile, American Millennials spend an average of 171 minutes a day on their smartphones. And this is not about calls. They send messages, manage finances and use maps. All of it commands a large part of our everyday lives.

Technology moving forward

In June 2017 Priorbank in Belarus has launched a new service that allows their costumers to pay with the help of a smartphone at shops and other places. The customers have to have a Visa card and an Android smartphone with Near Field Communication Technology to pay via smartphone. The technology is called Host Card Emulation. It allows creating a digital copy of a payment card in a special mobile payment app Prior Pay. Those payments, simply initiated with just one touch of the user’s smartphone, are possible wherever the icon for contactless payments is visible. According to the statistics, every 12th face-to-face transaction is contactless. This equals eight per cent of all payments in Belarus. Generally speaking, there are four services of non-bank systems that enables users to pay by smartphone: ApplePay, SamsungPay, AndroidPay and Microsoft Payments. But no one of them is officially represented in Belarus yet.

photo: zapp2photo – stock.adobe.com

Security

Payments via smartphones are even more secure than via cards. In Belarus cards of international payment systems are issued with a chip. It allows eliminating risk to compromise card data almost completely. Card information that is stored in the app follows the same principle. All transactions are based on a one-use non-recurrent cryptograph that meets the standards of the payment system. A mobile password is necessary to use the app. What is more, a smartphone is protected by a biometric password. Read more about voice biometrics in this article here.

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