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The Green SheetGreen Sheet

Thursday, January 26, 2012

Short takes on payments

Following are a few items that caught The Green Sheet's eye recently:

MasterCard mobile payments

MasterCard Worldwide said it is launching a pilot in Australia to test its new QkR (pronounced "quicker") mobile payment application. The new application will allow movie goers to peruse menus, order, and pay for food and drinks from their seats using smart phones. The purchases are delivered to the customer at their seats. QkR works by scanning a QR code or by entering a special QkR label.

Fed looks at authentication

A new article on the Atlanta Federal Reserve Board Retail Payments Risk Forum website compares and contrasts PIN authentication versus signature authentication. It reported that 91 percent of the debit card fraud in 2010, an estimated $804 million out of a total fraud loss of $880 million, was connected to POS signature debit transactions.

"Although the fraud rates for both signature and PIN transactions have increased over time, signature transactions still exhibit significantly higher loss rates, especially when comparing the transactions on a per-dollar volume basis," the Atlanta Fed stated. "Ultimately, PIN debit offers an additional and superior layer of authentication not offered on credit and signature debit transactions."

The Fed noted there are few merchants who have a POS PIN-based transaction capability and said statistics clearly show that if more people used PIN authentication, there would be less fraud. It added, "However, given recent EMV-related statements that Visa and the Merchant Advisory Group have issued, it remains unclear whether or not PIN authentication will become the standard in the United States."

Visa Inc. said recently on a corporate blog it does not believe PIN authentication will be necessary in the United States as the more secure Europay/MasterCard Worldwide/ Visa Inc. card becomes an accepted standard here.

NACHA clarifying language

NACHA – the Electronic Payments Association wants people to watch their language. NACHA has launched a campaign to popularize the phrase "via ACH" rather than other, more vague, terms such as "e-check" or "easypay." The motive behind the effort is to help people understand what the automated clearing house (ACH) system is and how it works. end of article

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