Australian holders of Visa credit cards, which are susceptible to hacking and other fraudulent practices, could soon bid their plastic money good-bye. Such move is possible if they buy new Android smartphones and download an app developed by Aussie payments product provider Cuscal.
Cuscal is the operator of the RediATM network and other financial services products for Australia's banking seector.
It would use the Host Card Emulation (HCE) system that ensures phone tap-and-go systems are secure without accessing the mobile device's secure element.
The devices communicate with a secured application that is cloud hosted which verifies the payment is from the card holder. The app removes the need for developers to spend time negotiating approval from phonemakers and telcos to access the secure element.
Unlike previous trials of similar systems made by the Commonwealth Bank of Australia and Westpac which runs only on Samsung Galaxy S5 phone, the app from Cuscal would operate on any Android with the Kitkat OS.
Although that could leave out users of older phones, Cuscal said most people anyway update their devices every 12 to 18 months, so their phone base would eventually expand.
Brian Parker, chief information officer of Cuscal, explained, quoted by the Australian Financial Review, "The interesting question is what the app can do that a card can't do. When you tap a traditional credit card on a reader you have no idea that it is charging the correct amount until you see a statement, with this it will instantly display on the screen, and you can also turn the card off when you aren't using it, so it is ultimately more secure than a piece of plastic by itself."
Adrian Lovney, general manager of products and services of Cuscal, said the pilot programme is running across half a dozen devices in the next few months. The firm will move for a full commercial launch at the end of the pilot testing period and once it gets the support of Visa which has endorsed the HCE.
Visa Group Country Manager in Australia, New Zealand and South Pacific Stephen Karpin said 40 per cent of the card's face-to-face transactions in Australia were done through its payWave contactless technology as he stressed the importance of developing the infrastructure to delivering secure mobile payments to consumers.