Ugandan bankers educated on contactless VISA application

BY PAUL TENTENA

As advancement in technology grows further, Visa International Service, a payment network based in the US, cooperating with financial institutions to issue different branded VISA cards has conducted a sensitization workshop for Ugandan bankers aimed at introducing to them a new technology called Contactless that provides instant, effortless, secure payments

According Paul Mutethia the Business Development Leader, Merchant Sales and Solution at Visa Sub-Saharan office based in Kenya, contactless is a secure, chip technology based on Europay Mastercard and Visa, the globally adopted standard for smart cards, that can be deployed on cards, mobile phones and many other devices.

He said that it has been designed to help customers spend less time at the cash register by allowing cardholders to pay simply by ‘tapping’ their card or device when prompted by the terminal at the till or checkout.

“Contactless payments utilise short-range wireless technology. A tiny antenna is embedded into the card or phone, which securely transmits payment information to and from the contactless reader.

“In order for the payment to work the contactless payment method must be held within 4 cm of the secure contactless reader.

“It takes less than half a second for the terminal to read the card details. After which the customer can remove their card and the transaction will be completed with an overall payment time, including authorisation, printing and handover of the receipt, of less than six seconds.

“This speed must be maintained to ensure that Contactless remains demonstrably faster than cash payment,” Mutethia told Ugandan Bankers under their Umbrella body the Uganda Bankers’ Association at a training that was held at the Golden Tulip Hotel in Kampala.

Mutethia said Contactless provides instant, effortless, secure payments and is becoming the preferred way to pay for everyday transactions in many economies.

“It offers opportunities for everyone in the payments ecosystem to capitalise on,” he told the Bankers.

Infront of mainly Information Technology specialists from Uganda’s banking sector, Mutethia added that Contactless helps merchants reduce point of sale queues and cash handling costs meaning that retailers can benefit from improved cashier sales per man hour.

“Customers are happy as a result of faster services while they also benefit from not having to enter a PIN or find the correct change.

“Additionally the payment device never leaves the cardholders hand making it more secure.

“Issuers and Acquirers are offered incremental revenue opportunities as consumers increasingly use contactless technology to make more transactions instead of cash and other payment methods, leading to higher activation and an increased marker share,” said Mutethia.

He said the rules that guide Contactless transactions are treated as chip to chip because they provide the same level of security as contact chip transactions, in that one has a cryptogram, Cardholder Verification Method (CVM) (online PIN or Signature or CDCVM in case of mobile) for any transaction that is above the CVM Limit.

“Based on this issuers can make an informed authorisation decision. As a result contactless is governed by the international business rules for Visa Easy Payment Service (VEPS) and CVM, these can be found in the Visa Rules,” he said.

Tackling common contactless security questions from cardholders Mutethia said cardholders are often concerned that their account could be debited more than once for the same transaction.

“This can’t happen, because Contactless readers are specifically designed to communicate with only one card and perform only one transaction at a time.

“If the reader identifies more than one contactless card in your wallet or purse, you will be asked to select one card to pay.

“A single transaction must be completed, or cancelled, before a second payment can be initiated,” he said.

Salma Ingabire, the Visa Card Country Manager said Uganda has over 6 million Visa Cards holders but about 6% are being actively used.

She called upon Ugandan bankers to think global by thinking Visa because it will save them from the hassle of banks that have to network with each other.

Visa is a prominent processing network, and its cards are accepted by businesses in more than 200 countries and territories around the world.

Other payment processing companies with ownership of payment processing networks include Mastercard, American Express, and Discover.

A financial institution chooses to partner with a single transaction processing network provider such as Visa for all of its payment card products.

Each issuer sets its own terms and conditions for the Visa cards it offers and decides on the customers to whom it will offer them.

Visa cards are available to individual and business customers through a range of financial institution partnerships

Service agreements include bank transaction fees and Visa network charges. Visa also partners with merchants through varying types of service agreements.

Merchants that accept Visa cards pay Visa Inc. a small transaction fee for each customer transaction as part of the cost for the network processing services the company provides.

Writer can be reached on paultentena@gmail.com or paultentena99@gmail.com