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Mobile proximity payments

If you have ever tried to pay with your smartphone in a shop, you are familiar with ‘mobile proximity payments’. The smartphone is the device used to access payment details such as card information when executing a face-to-face transaction.

Mobile proximity payments

The EPC’s work aims to support the development of mobile proximity payments by providing guidelines facilitating the interoperability of different solutions at European level and increasing their security.

Mobile proximity payments are mobile payments in which the payer and the payee are in the same location and where the communication between their devices takes place through a proximity technology (such as Near Field Communication (NFC), Quick Response (QR) codes, Bluetooth technology, etc.). Mobile contactless payments are part of the mobile proximity payments family. The underlying payment instrument may be a card or credit transfer. Mobile proximity payments encompass payments that are both Customer-to-Business (made, for example, at a merchant store, a car park, on public transport) and Person-to-Person.

Euro Retail Payments Board work on mobile card-based proximity payments

Card-based proximity payments, including those made on a mobile, are an area of focus for the Euro Retail Payments Board (ERPB – a high-level body chaired by the European Central Bank that brings together the supply and demand sides of the industry to address strategic retail payments issues). A report on this topic, with recommendations to various stakeholders, was prepared by a dedicated ERPB working group in 2015. The EPC contributed significantly to this report, which concluded that the European market for card-based proximity payments – and for mobile proximity payments in particular – is fragmented, leading to inconsistencies in the maturity of such solutions and in the implementation of the related technical standards.

To improve card-based proximity payments, the ERPB adopted the following vision:

“To ensure over time, across Europe, a secure, convenient, consistent, efficient and trusted payment experience for the customer (consumer and merchant) for retail transactions at the Point of Interaction (POI), based on commonly accepted and standardised contactless and other proximity payment technologies.”

The report details specific recommendations for the various stakeholders in the ecosystem, including, among others, card schemes, payment service providers, mobile device manufacturers, standards and industry bodies (including the EPC and the European Cards Stakeholders Group), and the European Commission. These recommendations have been endorsed by the ERPB and should be implemented by the end of 2017.

The recommendations mainly focus on technical and security standardisation aspects, regulatory issues, customer guidelines and communication. For the latter, a consumer leaflet about the benefits of contactless payments was created with the support of the EPC.

Mobile contactless SEPA card payments interoperability implementation guidelines

To further contribute to the ERPB’s vision for mobile proximity payments, the EPC recently updated the Mobile Contactless SEPA Card Payments Interoperability Implementation Guidelines or ‘MCP IIGs’. This document, last published in 2011, defines the implementation guidelines for mobile contactless card payments. It also describes technical and security aspects for different components of a mobile contactless payment solution.

This document aims to be a reference for all stakeholders involved with mobile contactless card payments in Europe. With the support of stakeholders from the mobile contactless payment industry, the MCP IIGs have been updated to reflect the rapidly evolving MCP ecosystem - many new entrants joined the market and new technologies emerged. In addition, alignment with new regulations (e.g. PSD2) and with recent work from other standardisation and industry bodies needed to be urgently addressed.
The final MCP IIGs, addressing the comments received through a 3-month public consultation on the document that was launched in October 2017, are now available via the link below.

Mobile Contactless SEPA Card Payments Interoperability Implementation Guidelines

Read the mandate and membership list of the MSG MCP

Read the minutes of the meetings of the MSG MCP