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MasterCard flashes its online wallet

David Ramli (via AFR) | Feb. 28, 2013
Mastercard has launched an online wallet service, MasterPass, designed to allow credit card details to be stored either on smartphones or the internet.

MasterCard flashes its online wallet

Photo: Michel O'Sullivan

MasterCard has launched a new digital wallet program designed to streamline online shopping but warned that paying for products with mobile phones could still be years away.

On Monday the company announced it was launching MasterPass – an online wallet service designed to allow credit card details to be stored either on smartphones or the internet. Australia will be the first country to get the service in March.

When online shoppers go to purchase products, participating retailers will include a MasterPass button at the checkout. Once users fill in their usernames and passwords, details such as credit card numbers and addresses are automatically filled in and confirmed.

The service is similar to eBay subsidiary PayPal and is aimed at helping customers on smartphones, who may find it difficult to shop on devices with small screens.

But MasterCard head of market development Matthew Barr confirmed that shoppers trying to buy products at retail websites requiring a card verification code (CVC) would be rejected. CVC codes are security numbers printed on the back of credit cards to confirm that customers are not using stolen credit card details.

“The details sit securely on a MasterCard server on the network,” he said. “We see those as getting in the way of a really slick customer experience.

“Our expectation is that over time the inputting of CVC will no longer be part of that checkout experience. But cards and card-based checkouts will be around for a long time.

“You need to get to a position of volume [before merchants sign up].”

HackLabs director Chris Gatford said the vast majority of online retailers still required CVC codes to prevent stolen credit card numbers being used. He said the MasterPass program would reduce the number of potential sources for hackers and criminals.

“Rather than having thousands of venerable points from merchants to payment points, etc, you’ve only got one,” he said. “This means they can really focus on security and finding compromised users.

“But on the flip side, you’ve only got one target to go after and if they’re successful you’ve got an extremely bountiful source there.”

JB Hi-Fi, Harvey Norman, Roses Only and AHL, which runs Event Cinemas and Rydges Hotels, have all agreed to offer MasterPass at online checkouts as part of the launch. Commonwealth Bank, Westpac, NAB and ME Bank are also working on offering the service using their brand names and MasterCard’s back-end systems.

 

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