ICICI Bank has introduced a contactless mobile payment solution to enable its credit and debit card customers to make in-store contactless payments by waving their smartphones near an NFC-enabled merchant terminal.
The mobile payment solution available in the Bank’s ‘Pockets’ app, provides improved convenience of ‘Touch & Pay’ as customers are no longer required to carry a physical card or cash to pay in stores, a media report quoting bank officials.
ICICI Bank is the first financial institution in the country to leverage the Host Card Emulation which creates ‘virtual’ cards for ‘physical’ credit or debit cards (Visa/MasterCard) of the bank, as selected by the customer. The virtual card resides in the bank’s secure cloud server and not on the customer’s mobile phone.
Additionally, the display of the card on the smartphone shows only the last four digits of the virtual card. Thus, even if a customer loses his/ her mobile phone, he/ she will not lose any confidential information about his/ her original and virtual card. Further, for each payment via the virtual card, a one-time unique token number is created by the bank’s server, which is encrypted and sent to the merchant’s terminal, without disclosing any information of the card.
Rajiv Sabharwal, Executive Director, ICICI Bank told The Hindu Business Line, “Credit card and debit card customers of ICICI Bank will now be dematerialised. With India becoming the second largest market globally for mobile subscribers as well as smartphones, we expect this to be a big game changer in the Indian payment industry, as it will transform the smartphone into a virtual wallet.
“The speed of transactions will add momentum to cashless payments. At the same time, it will herald a shift from low-value cash payments to electronic payments at physical stores, including quick service restaurants and shopping marts, where fast transactions are much required. Also, the level of security is higher since the card details are not shared during the transaction process.”
ICICI Bank launches this contactless mobile solution nearly a year after introducing contactless debit and credit cards. Last year, the bank became the first to enable its customers to make electronic payments by just waving the cards near the merchant terminal. With this solution, the customers do not need to even wave their physical cards to make payments, their mobile phones can do the same.
To use this proposition, an ICICI Bank customer is simply required to click on the Touch & Pay icon on the home screen of the ‘Pockets’ app in his/ her smartphone and select the desired virtual credit / debit card. Once the merchant enters the amount to be charged, the customer can just wave the phone near the POS machine. A text on the phone as well as on the merchant’s terminal will confirm the transaction.
This mobile payment solution has been launched currently for the employees of the bank and will be available for customers in the last week of March when the updated ‘Pockets’ application will be available on Google Play Store. In accordance with the RBI guidelines, customers can make payments up to Rs. 2,000 per transaction with the mobile payment solution.
Currently, there are around 40,000 NFC terminals and this number is expected to jump to 1 lakh in the next three months. The bank is currently in talks with e-commerce firms, including Uber, for tie-ups for using its payment solution, added Sabharwal.