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July 2007 • Volume 12 Number 7 |
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Executive Director's Letter Dear members and friends of the Alliance, Another month has passed and we still do not have much closure around the Department of Homeland Security (DHS) Western Hemisphere Travel Initiative (WHTI) PASS card project. As one Alliance member appropriately observed: the government seems to have a different set of security principles for its own Federal employees (secure HSPD-12 compliant ID cards) than it has for its citizens. Despite the volumes of published materials and the thousands of negative responses to the Notice of Proposed Rulemaking (NPRM) that all cited the dangers of using insecure, long range RFID technology for the proposed PASS card, DHS has remained resolute in its position that the PASS card program will move forward without addressing the security and privacy concerns raised by the Alliance, the Secure ID Coalition, the Center for Democracy and Technology (CDT), the ACLU and other concerned public policy organizations. The Alliance recently took our message directly to the government’s Congressional branch by hosting a briefing at The Capitol on July 18. We were joined by the Secure ID Coalition, a digital security organization, Janice Kephart, former counsel to the 9-11 Commission and Leslie Harris, Executive Director at CDT. Each speaker on the panel presented perspectives on security and identity best practices to educate Senate and House of Representative staff members about the requirements for security and privacy in any government identity program and the differences between RFID technology and secure contactless smart card technology. Tres Wiley, from Texas Instruments, even brought an RFID tag and reader to the briefing. He demonstrated to the audience how easy it was to read an unprotected, long-range, RFID-based card from about 20 feet and write its embedded RFID tag number to a duplicate tag in a matter of minutes. Video of the RFID cloning demonstration and panel presentations are available on the Alliance web site. Perhaps if enough questions are raised from within government by those responsible for funding this legislative mandate, we can still save the government from making this terrible mistake. The Smart Card Alliance Smart Card Products and Services Directory: Bringing Buyers to Members How can the Smart Card Alliance help bring buyers to members? This question drove the development of a soon-to-be-launched feature on our public web site – the new Smart Card Products and Services Directory. We're bringing you a preview of the directory in this month's newsletter. Each month, the Smart Card Alliance web site has over 80,000 unique visits to our public web site, with many of the visitors using the popular Smart Card Reader Catalog to find products and suppliers. The new Smart Card Products and Services Directory greatly expands the range of products and services that can be found – allowing potential customers or business partners visiting the Alliance web site to identify companies or organizations that provide specific products or services to their industry of interest. The directory is straightforward to use. Visitors to the directory may view listings by industry or by product offering or can search the directory for specific offerings. By clicking on a member listing, visitors will find a brief description of the member's business, a link to the member's web site, and a full list of the product and service offerings entered in the directory.
The introduction of contactless payments technology into the mass market is an important development for both consumers and merchants. Contactless payments provide immediate benefits to both parties in the form of more consumer control and increased consumer and merchant convenience. And these benefits represent only the tip of the iceberg. Merchants who accept contactless payments realize advantages in several areas. First, contactless payments are faster and more convenient. Studies have shown that contactless payments reduce customer time at the POS by 30%-40%. Contactless transactions are 63% faster than cash transactions, and 53% faster than traditional credit card transactions. The most significant time savings are realized in the drive-through environment, where 12-18 seconds are saved off purchase times. These increases in speed and convenience result in greater sales volumes and increased customer spending. Customers spend about 20%-30% more when using contactless payment devices than when they use cash. Customers not only spend more, costs decrease when merchants accept contactless payments. The use of contactless payments means fewer requirements to handle cash, improved operational efficiencies, and reduced maintenance costs. Contactless payments also present merchants with a tailor-made opportunity for clear differentiation. Being able to offer "the latest thing" puts merchants in an excellent position to offer closed-loop products (such as gift cards) that strengthen customer loyalties and increase brand awareness. The variety of form factors in which contactless payment devices can be available also supports differentiation. Merchants and issuers can collaborate on payment products that blend specific features and packaging (cards, tokens, mobile phones) and target different customer segments with very particular requirements for the shopping experience.
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Accepting Contactless Payments: A Merchant Guide
Executive Director's Letter
