ePayments Project
Final Report of Initial Project Work
RNIB Innovation Unit
August 2010
Prepared for:
RNIB ePayments Project Board and Stream Lead
By:
Jon Wyllie, Edward Chandlerand Kiran Kaja
Innovation Unit
Royal National Institute of Blind People
Table of Contents
Acknowledgements
1.0 Introduction
1.1 ePayment Solutions – what they are
1.1.1 Contactless Payment systems
1.1.2 Chip and PIN
1.1.3 Self-service Kiosks
1.1.4 Pre-paid/gift cards
1.1.5 Mobile phone payment
1.1.6 Online payments
1.2 Scope
2.0 Review of literature
2.1 The Finance Stream
2.2 The Retail Stream
2.3 The Transport Stream
2.4 Existing Standards
3.0 Summary of issues with ePayment methods
3.1 ePayment methods
3.1.1 Contactless Cards
3.1.2 Chip and PIN
3.1.3 Self-service Kiosks
3.1.4 Pre-paid/gift cards
3.1.5 Near Field Communication (NFC)
3.1.6 Mobile phone payment (SMS)
3.1.7 Mobile phone payments (apps requiring bank details)
3.1.8 Online transactions (Cards/Direct Debits etc)
4.0 Review of current industry initiatives
4.1 Political
4.1.1 European Influence
4.1.2 UK Government
4.1.3 RNIB Campaigns
4.2 Economic
4.2.1 The UK Payment Sector
4.2.2 The role of Visa and MasterCard
4.2.3 The UK banking sector and economic climate
4.2.4 Incentives
4.3 Social
4.3.1 Credit
4.3.2 Fraud
4.3.3 Loyalty Cards
4.3.4 Ageing population
4.3.5 Environmental impact
4.4 Technological
4.4.1 Cash Manager Card
4.4.2 Visa payWave
4.4.3 Paymo
4.4.4 sQuid
4.4.5 StagecoachSmart travel card
4.4.6 Mobile Applications
4.4.7 Virtual payments
4.5 Additional opportunities
5.0 Conclusions
6.0 Recommendations
6.1 Engage with the EU and key stakeholders regarding the Payment Services Directive
6.2 Engage with the Department of Transport on contactless card rollout
6.3 Engage with the Payment Council
6.4 Critically review up and coming technology
6.4.1 Contactless payment systems
6.4.2 Self Service Kiosks
6.4.3 Smart metering
6.5 Implement exemplar banking services
6.6 Use the Olympic and Paralympic Games to leverage positive change
6.7 Establish, maintain and improve relationships with key stakeholders
6.8 Determine whether ePayment systems, wayfinding systems and retail can be linked
6.9 Review security issues
6.10 Continual Review of New Technology
Appendix A: Literature review of the finance stream
Appendix B: Literature review of the retail stream
Appendix C: Literature review of the transport stream
Acknowledgements
The authors of this report would like to thank Sabine van den Heuvel and Shaun Leamon for their involvement in the project and collating the information for this report. Special thanks to John Worsfold for his help to get this report ready.
1.0 Introduction
The ePayments project is part of the RNIB Group Strategy 2009 - 2014: Ending the Isolation of Sight Loss. Under Priority 3 of the strategy, RNIB aims to help create an inclusive society by making it possible for:
- More people to make journeys safely and independently
- More people to shop independently and have personal control of their money
This project focuses on those elements which currently restrict and isolate blind and partially sighted people from making “cashless” electronic payments and identifies ways forward to remove these restrictions. Electronic payments are becoming essential components of paying for goods while shopping (both in-store and online) and purchasing tickets for travel, making it vital to ensure that blind and partially sighted people can use them independently.
1.1 ePayment Solutions – what they are
ePayment solutions refer to the transaction of goods or services using electronic payment means. This typically involves the use of computer networks, the internet and digital systems to transfer money electronically or digitally between two parties.
1.1.1 Contactless Payment systems
Contactless payment systems, also known as "tap and go" or "wave and pay" is a method where a person pays for everyday items, by holding a transaction smartcard, key fob or other device near or on a locator. The transaction under a specified amount (e.g. £15) is normally completed with no need to sign or key a number into a keypad. The advantage of using this method is that the transaction process is generally much quicker than traditional payment methods.
Contactless payment cards come in many forms:
- Prepaid cards – these have a fixed amount of funds allocated to them such as the Oyster card,and areused as a form of electronic ticketing on public transport services within the Greater London area. These cards can be “recharged" from numerous sales points.
- Mobile phones with Near Field Communications (NFC) - NFC phones or cards can be stocked up with credit and then used as payment. The user simply waves their phone over the reader and the payment is debited from their account or added to their credit card bill. When making larger payments, authorisation will be required. Unfortunately many of the mobile phones that are needed to do this are not widely available or accessible to blind and partially sighted people.
1.1.2 Chip and PIN
This is the method where people use credit and debit cards with a choice of a PIN or signature. These are widely available and there are many places where portable pin pad devices are used as the primary method of payment.
1.1.3 Self-service Kiosks
Self service kiosks are alternatives to the traditional staffed checkouts and are quickly becoming a common sight within retail settings. They are being installed with the purpose of replicating the advantages of online shopping in-store, streamlining in-store operation with the potential of freeing staff to focus on customers. Unfortunately today, the majority of kiosks rely on touch screen technology that is not accessible. There is concern that the personal touch and social interaction provided by checkout staff is being lost by self service kiosks.
1.1.4 Pre-paid/gift cards
Pre paid/gift cards are transaction cards that have a fixed amount of funds credited to them. There is an increasing number of prepaid credit cards being launched and targeted at different groups at this time. Some are specifically targeted at teens and under 18’s who may not be eligible for a bank accounts, whilst others offer fully branded prepaid Visa or MasterCard’s with Chip & PIN capability with high value reload capabilities. They are marketed as a means to manage your spending more effectively as you can only spend the amount that credited on the card.
1.1.5 Mobile phone payment
Mobile phone payment or M-payment as it is referred to is a new and rapidly-adopted alternative payment method – especially in Asia, Africa and Europe. Instead of paying with cash, cheque or credit cards, a consumer can use a mobile phone to pay for a wide range of services and goods.
There are three primary models for mobile payments:
- Premium SMS based transactional payments
- Direct Mobile Billing
- Contactless using Near Field Communication (NFC)
Premium SMS – This is where a payment request is sent via an SMS text message and a premium charge is applied to your phone bill. One example of this payment method is as follows:
“The user simply selects the items, takes these to the till and informs the cashier that they want to pay via SMS. The seller sends a payment request to the buyer with a text message, the buyer then keys in the PIN to approve the sale and responds to the seller's SMS. Once the transaction is complete, both parties receive an SMS receipt.”
An advantage of this method is that there is no loyalty program or special handset required and any regular bank account holder with a phone can send money.
Direct mobile billing – This is similar to SMS billing where the consumer uses a mobile billing option during checkout but differs because it uses an ecommerce mechanism to charge the payment to the mobile phone account used. After authentication involving PIN and Password, the consumer's mobile account is charged for the purchase.
Contactless using near field communications – This technology allows mobile phone handsets to be capable of completing transactions when the phone is waved in front of a reader.
Mobile phone applications - This method relies on web pages being displayed or additional applications downloaded and installed on the mobile phone to make a payment. It uses mobile internet as underlying technology and thus inherits all the advantages and disadvantages of narrowband internet. If the mobile account is not directly charged through a mobile network operator, the use of a credit/debit card or pre-registration at online payment solution such as PayPal is still required just as in a desktop environment.
1.1.6Online payments
Whilst the ability to shop online to buy goods and services is an ePayment method, it generally involves using traditional solutions in terms of debit and credit cards to complete the transaction. However the mechanisms in place which facilitate these transactions are electronic in nature. Making a payment online could involve the following methods:
- Direct debit/Standing order
- Credit/debit card
- 3rd party payment facilitator (e.g. PayPal)
As they are all web based, their accessibility is largely reliant on the providers making the sites conform to web accessibility guidelines.
Direct debits/standing order –These are both mechanisms which allow people to set up regular payments. Direct debits are usually initiated by the seller whereas standing orders are usually set up by the account holder. To use these online, a person needs to have access to their bank account online.
Credit/debit card – To use this method to buy goods and services require the buyer to input the card details into the website they are buying the goods from. This will involve providing the long card number, start date, end date, name on the card and security number on the back of the card. The website will usually have security measures to make sure the transaction is secure.
3rd party payment facilitator – These methods provide the means to send money electronically from one person to other or to a company where there is no ecommerce facility. A prime example is PayPal and eBay. The buyer can use PayPal (which holds the debit/credit card) to pay for goods through eBay. The seller receives the money and can then transfer it into their bank or keep it in their PayPalaccount to make further transaction.
1.2 Scope
The first phase of this project was a fact finding phase and this report summarises the findings of the work performed so far. This work was split into three sections with the following aims:
To:
- Review research literature on ePayment solutions
- Perform a brief expert appraisal of ePayment solutions
- Understand what industry is doing in terms of rolling out ePayment solutions.
By doing this, RNIB will gain an understanding of the current situation and will be able to strategically direct its resources to focus on the most important solutions.
The project team discussed the need for user input to help determine where RNIB should focus our attention. Decisions about the development of ePayment systems will be driven by the market so it was decided that user input would have limited value at this stage of the project.
2.0 Review of literature
The first stage of the project involved collecting information about research that had already been carried out into the needs of people with sight loss using ePayment systems. Since there is a wide range of ePayment technologies, we decided to split this research analysis into three specific sectors. The following literature review looks at technologies that are being used in:
1) The finance sector
2) The retail sector
3) The transport sector
In addition to these areas, is a piece of research conducted by RNIB’s research team, Evidence and Service Impact[1]. This research sought the experiences, expectations and preferences of blind and partially sighted people in relation to management of finances.
The research had a number of key findings and conclusions which need to be considered when thinking about ePayment solutions. Firstly, there is a variation between how people control their finances. Some allow a third party (such as a friend or relative) to manage their money, whilst it appears that some use powers of attorneys to sort this problem out. The research did not determine whether people were happy with third parties controlling their money.
The research identified that cash is usually withdrawn by a person visiting their bank although this was not so important for older people. ATM’s were highlighted as a source of money but also a greater source of problems for a number of different reasons from poor visual information to a lack of audio output.
The identification of banks notes was problematic for some however coping strategies (such as folding notes in particular ways) had been employed to solve the problem.
Direct debit was seen as a common method for paying regular bills; however the use of internet and telephone based payment systems were less common. The reason for this could be down to the individual being asked for their card details, which they couldn’t read.
One of the most interesting findings focussed on the use of technology. The research highlighted that, “The use of technology and gadgets appeared to be a marker of those who had a greater degree of independence in controlling their finances.” This is quite telling and shows that where solutions are in place, and can be made use of, the more successful an individual will be to control their money.
The research concluded that the ability of blind and partially sighted people to control their own money is hinderedby a number of different barriers. The results of these barriers are a loss of privacy and a greater reliance on other people.
2.1 The Finance Stream
This stream was intended to capture any available literature or research around the accessibility of activities pertaining to managing finances and making payments in environments other than retail and transport(e.g. managing a user's bank account, making regular payments such as utility bills and so on), specifically for blind and partially sighted people, but also for people with other disabilities. Information about the various reports can be found in Appendix A.
During the desk research however, a few significant things emerged.
- Most issues around managing finance actually fall under the remit of web accessibility for the reason that accessibility of online banking services seems to be the most researched topic.
- More alternatives for users to manage their finances or make regular payments exist in the finance stream as opposed to retail and transport streams (e.g. telephone banking)
- Most of the identified research or literature may not be relevant anymore because of the pace at which technology is evolving.
2.2 The Retail Stream
The literature review and desk research in this stream was mainly concentrated around identifying any prior studies which could help the project team get a better understanding of the challenges that blind and partially sighted people face when trying to pay for their purchases in a retail environment. Information about the various reports can be found in Appendix B. Some of the key findings from this research are mentioned below.
- Contactless payment technology seems to be growing in popularity as it is being heavily promoted by banks, credit card companies as well as retailers.
- Although a number of card companies are claiming that they are issuing a large number of contactless cards, it is however not clear how the uptake amongst consumers is.
- Contactless technology seems to present the biggest challenge for blind and partially sighted people as most of the process is not accessible and users don't have a sense of control like they seem to have with chip and pin.
- The other area of concern for blind and partially sighted users is the growing popularity of automated point of sale kiosks like the self check-out machines found in most supermarkets.
2.3 The Transport Stream
In this stream, an attempt was made to capture any available literature around the accessibility of payment systems in the public transport sector. More information about the various reports can be found in Appendix C.
- Payment systems based on nearfield communication technology are extremely popular.
- There is hardly any research done to ascertain the accessibility of these payment systems for blind and partially sighted users.
- There are an increased number of self-service terminals in use for ticketing and for information provision and there seems to be no accessibility features in any of the systems in use.
2.4 Existing Standards
While conducting the literature review, the project team also looked at identifying any existing standards and guidelines that are related to the accessibility of ePayment systems in all the above streams. Some of the more relevant standards are listed below.
- ISO/IEC 7810 (2003) Identification cards: Physical characteristics[2]
- ISO 9564: 2002 Banking - Personal Identification Number (PIN) management and security. Parts 1, 2, 3 & 4[3]
- EBS100 V3(October 2004) Keyboard Layout for ATM and POS PIN Entry Devices[4]
- CEN/TS 15291 (2006) Identification card system - Guidance on design for accessible card-activated devices[5]
- Various smart card standards[6]
3.0 Summary of issues with ePayment methods
So that the top level issues related to ePayment solutions could be better understood, the project team performed a brief review of the various ePayment methods mentioned in the introduction. At this stage the findings are generated by expert opinions from either having used these methods or by performing desk based research on the different solutions.