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Visa and PrivatBank to launch secure contactless payments Visa Token Service

On Monday 12th December,  Visa and PrivatBank introduced Visa Token Service – an innovative service for contactless secure payments – to the market. It allows users to protect card holders’ private information, by replacing data on a card with digital tokens that users will store on their devices or in special storage locations. 

To pay for your purchases via Visa Token Service you are required to activate in your mobile wallet contactless option and to touch POS-terminal with your smartphone. You need to have mobile phone supporting NFC option with Android v4.4 or a higher installed and installed updated Privat24 mobile app. The service currently is available for only PrivatBank’s clients and Visa card holders.

Marketing Director at PrivatBank, Mr Sergey Danilenko, mentioned that the bank had already rolled-out contactless payments as early as 2013 – but that was before the introduction of the Token Service. From 2016, the bank is moving on to the Visa Token Service. “We’ve put the infrastructure in place for contactless payments in Ukraine – 80,000 terminals, and 800,000 cards”, Mr Danilenko said.

 

Visa Token Service is a payment tool offering both speed and security, while remaining very simple to use. Its development is flourishing throughout the market. For example, currently one payment in every twenty in Ukraine is contactless. And the role of mobile devices in the lives of average consumers continues to expand. “Today eight people out of ten wouldn’t leave the house without their mobile phone – although they might forget their wallet. Stats also show that the average statistical user uses their mobile phones around one hundred times per day. Today our mobile phones are our alarm-clocks, recipe books, diaries, mail-boxes, newspapers… and much more besides! This simply makes it obvious that the next step lies in making payments from our mobile phones”, Mr Scherbina said.

During the presentation, Mandy Lamb – the General Manager for Visa in the CIS countries and SE Europe – emphasised that innovation is driving the world, and backed this up using global and Ukrainian statistics. For example – Cisco believes there will be 50 billion connected devices worldwide, and that these mobile devices will continue to evolve. Also by 2020, user numbers for mobile banking worldwide will reach around 1.8 billion people. What role in this innovative evolution will Ukraine play? As the General Manager for  Visa in the CIS countries and SE Europe noted, 71% of the population will be using smartphones by 2020 (compared to just 35% in 2016). She suggests that there are several payment scenarios currently: person-to-person, online payments, click & pay, and hybrid kinds of card payment. In the future these payment scenarios could be merged, and Visa will be playing an important role in this transformation.

 

“Today we are talking about responsible innovations, which means we’re talking about improving the consumer experience by using heightened security in place”, Mandy Lamb commented.

It is also available ShareCreditCard service on the Visa Token Service basis. This tool is developed for PrivatBank clients only and it allows PrivatBank’s Visa card holders to virtually share it with friends and relatives. All a sender or receiver needs is a mobile phone with Android v4.4 or higher installed; an installed copy of the Privat24 mobile app. So how will the ShareCreditCard mobile app work?

Maria Gurina – Head of Partnership Projects for PrivatBank , mentioned that transmission of the digital token takes place instantaneously, to any mobile phone number anywhere in the world. The receiver sees a push-notification and can then complete the contactless payment. And this all happens – as the developers stress – with no physical movement of cash, but by making access available to funds on the holder’s card. This access can only be used for contactless payment (with a transaction ceiling, currently set at $500), and physical cash withdrawals from ATMs are not permitted.

During the presentation of the ShareCreditCard service, the innovation was actually tested live in the lecture hall, by sharing a card held by one of the event attendees. Next, a demonstration was given showing how the service can function on a global level. Over a Skype connection, two FinTech publishers – the Ukrainian magazine ‘Future‘, and the British publisher ‘Disrupts Media’ – tested the innovation live. Transmission of the digital token was sent by Future’s editor-in-chief Kate Shcheglova, sitting in the presentation in Kiev – while the access receivers were British colleagues, CTO at Disrupts Media Veronika Bondareva, and co-founder of Disrupts Media Katia Lang – both located at the Google Campus in Central London.  The successful test was met with warm applause. Receiving the token took just seconds, as did confirming the contactless payment.

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It is important to mention that ShareCreditCard service was developed by the Corezoid team (PrivatBank) and won Money 2020 hackathon in Las Vegas several months ago. The ShareCreditCard mobile app offers a radically new and easier way to transfer money. Instead of complex and slow monetary transfers, this app offers instant, cost-free card-access transmission all over the world. It’s a system that might eventually save you from carrying flimsy plastic cards around – which are so easy to lose.

 

Kate Shcheglova,

editor-in-chief of “Future” magazine

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