The Green Sheet Online Edition
August 13, 2007 • Issue 07:08:01
On queue: Self-service card payments come of age
Self-service vending devices that accept cash and
coins have been available for over 100 years.
But until recently, do-it-yourself bankcard payments
have been limited to pay-at-the-pump
purchases in the petroleum marketplace. Automated,
interactive kiosks have now migrated to ATMs located
off bank premises. They are part of an emerging market
that may not change your life overnight, but it certainly
Unattended card payment terminals have shown up in
a variety of environments, including parking garages,
vending machines, photo kiosks and event ticket sales, as
well as supermarket checkout lanes.
Retailers report that self-service payment options are
embraced by all customer segments and demographics,
from elderly pensioners to young technophiles.
Consumers are voting with their wallets for expediency,
ease of use and freedom to choose the time and place best
suited for shopping. And their endorsement is not solely
limited to low-value transactions. In some regions, even
high-value goods, such as mobile phones and MP3 players,
are sold through vending machines.
Self-checkout options have been shown to generate a
40% reduction in average queue times, with increased
throughput of up to 20%, enabling retailers to effectively
cope with peaks and troughs of demand.
Seeking to increase the ways consumers can obtain goods
and services, many companies are investing in their ability
to take secure payments in unattended environments
and deliver enhanced 24/7 self-service options.
Making the grade
In a self-service environment, card payment terminals
must be intelligent enough to handle a range of payment
options: credit, debit, gift or prepaid cards, for example.
Terminals must differentiate between each payment
card type and prompt users appropriately through
transactions. Stand-alone systems must meet all security,
reliability and performance standards of everyday countertop
payment systems, plus unique requirements based
on their usage and environment.
Most self-service POS equipment's core technology
usually integrates a card reader and a secure keypad
for PIN entry. Other components, such as a display,
receipt printer or communications module, may also be
installed, depending on the needs of individual equipment
While installing card acceptance technology in self-service
equipment gives consumers flexibility, it also exposes
vendors to potential fraud from stolen or duplicated
cards. This requires mechanisms to authenticate cardholders
and their payment cards.
Designing for PCI
Unattended payment systems with PIN pads must adhere
to Payment Card Industry (PCI) Data Security Standard
requirements specific to unattended PIN entry environments,
known as PCI EPP.
Design is an important consideration in choosing a keypad.
For outdoor environments, a waterproof or weatherproof
design may be desirable. Ruggedness and vandalproof
features may also be needed. The zone of security
surrounding the keypad (which prevents others from seeing
a user enter a PIN) is also critical. Finally, accessibility
is a must. This factor will determine the size of the keys well as area lighting and keypad illumination.
A communications module can be used for a number of
different tasks. It can authorize and settle card transactions
directly with a bank; it can send card details to a
POS controller that then handles bank communications;
or it can download new software or settings to the payment
If a self-service machine is located on a merchant's
premises, such as in a pay-at-the-pump or in-store kiosk
setting, it usually makes sense for the communications
module to have a fixed-line configuration such as a serial
cable or a local area network connection.
For a remotely located self-service machine, such as a
vending machine or photo kiosk, a fixed line may be difficult
to install. Thus, a Wi-Fi, general packet radio service
(GPRS) or code division multiple access (CDMA) wireless
link may be more appropriate.
Thwarting crime and grime
Vandal-proof characteristics are important for payment
terminals that will be used in public areas where full-time
security is not provided. Self-service equipment in these
locations needs to withstand a good deal of abuse without
breaking down. While it is almost impossible to develop a
device that will resist an attack from a determined vandal,
downtime can be minimized by using strong materials, a
rugged design and an effective alarm system.
Tamper-proof characteristics can keep confidential payment
card information (PIN, card number and expiration
date) secret from those intent on stealing it. If someone
tries to open or tamper with a PCI-certified terminal,
for example, it will disable itself and destroy all of its
secure information, including encryption keys and transaction
In locations where terminals are exposed to adverse
environmental conditions, the design and materials used
will typically prevent water and dust from entering the
machine's body. Devices that endure extreme hot and cold
temperatures may also have special electronic components
to make certain they do not break down.
VeriFone expects the unattended payments sector to grow
rapidly. As this market spreads, sales and distribution
strategies will have to adapt. Pay attention to this area, so
you will be poised to take advantage of it.
Paul Rasori is VeriFone Vice President of Global Marketing. He can be contacted at firstname.lastname@example.org.
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