Mobile payments and trends in the UK

Mobile payments in the UK

Mobile payments have, in recent years, infiltrated the mainstream business propositions of some of
the well-known technology companies that design, develop, and sell consumer
electronics, computer software, and online services. Apple, Google and Samsung all provide mobile
payments services under the names of Apple Pay, Google Pay and Samsung Pay, commonly referred
to in the payments industry as the OEM Pays. These technology giants, have arguably played a
significant part in raising the collective consumer consciousness around NFC mobile payments in the
last couple of years. A number of questions remain about how far they will take their payments
proposition? What is their end game? Are they out to disrupt and compete directly with the banks?
For the moment, the answers are closely guarded and while speculation is rife, only time will tell
what the outcomes will be.

In the UK, banks are facing continuing uncertainty surrounding Brexit and how this will affect their
future business, resources are stretched as a result of competing priorities to meet regulatory
deadlines such as MiFID II, PSD2 and GDPR, and to cap it off, budgets are shrinking, and spending is
being more closely scrutinized. Considering these and other challenges, the majority of banks are
nevertheless showing signs of continuous and growing investment in technology, to address not only
regulatory issues, but also in recognition that their existing legacy systems are too inflexible and
limiting to address the needs of the bank of the future.

Challenger banks, increasingly present in the UK market, are gaining traction along with the monikerof “disrupter”. Some challenger banks, now offer services going beyond traditional current accounts
and are actively targeting specific segments such as SMEs and Corporates. Their clear advantage is
in their ability to develop their technology stacks by eschewing models of bespoke development in
favor of off the shelf solutions and strategic partnerships with FinTech companies. They are not
bound by the legacy constraints of the traditional banks.
One common feature of the tech giants, banks and challenger banks is their burgeoning interest in
mobile payments.

The mobile payments landscape in the UK is dominated by the OEM Pays. It is not really surprising
that with all the pressures outlined above that banks, and, to a lesser degree, challenger banks have
adopted Apple, Google and Samsung as the lynchpin of their consumer mobile payments strategy.
By rolling out the OEM pays, they are, arguably taking the path of least resistance. There is, some
would argue, value in the relative ease of rolling out a mobile payments service backed by a trusted
name in technology.

For the end customer, NFC enabled mobile phones are the norm, as is the brand association. The
OEM Pay platforms on offer are ready and enabled straight out of the box. Add a funding source –
credit or debit card – and the service “just works”.

One very successful use case in the UK is around transport. TfL (Transport for London), in addition
to their Oyster Card program, has enabled all their terminals for contactless and NFC payments.
Commuters are increasingly using their phones to pay for public transport. In 2017, one in 10
journeys were made with mobile devices, equating to more than 31 million journeys.


With the proliferation of contactless POS terminals in retail locations and the fact that most POS
terminals will be NFC enabled in Europe by 2020, we can already see momentum building. Forrester
predicts that the European mobile payments market will vault to €148 billion by 2021. Mobile in-
person payments will grow the fastest, increasing almost fivefold between 2016 and 2021, from €4.6
billion in 2016 to €22.8 billion in 2021; they will account for nearly 16% of all mobile payments in the

Mobile payments are gaining traction and given the fast pace of change are likely to evolve in the
coming years. But are the banks missing a trick? Could they be leveraging mobile payments as a
conduit to promote their own bank apps and value-added services? Arguably, yes. In the current
environment, OEM Pays are co-existing alongside the bank apps. By choosing to pay through an
OEM Pay, customers are disintermediated from their bank as they can “fund” their mobile payment
purchases with any card issued by any institution. While the banks are paying out a small
percentage to Apple for the Apple Pay service, Google does not charge for the service but rather
collects payment transaction data. This was also showcased in the short clip attached from a BBC documentary entitled Billion Dollar Deals and How They Changed the World.

At a time when banks are competing to retain their customers, it seems counter-intuitive to be
giving away a valuable commodity which they possess. This is data that can be analyzed and used to
upsell customers relevant products such as, personal loans, mortgages and other revenue
generating products and services. It is the glue that can create sticky customer relationships and
retain their custom over the course of changing life events. By combining the mobile payment
functionality (be it as Issuer Pay and/or OEM Pay) into the single bank app, both parties benefit. The
bank, gains greater visibility on the habits and ensuing trends of their customers, together with the
added value of being able to target products and services tailored to their needs. For consumers, it
gives them a choice of payment options all the while using a single trusted app for all their payment
and banking needs.

At MeaWallet, we have built our platform to turn banks’ mobile payment aspirations into reality and
support the evolution of their mobile strategy. We would be pleased to discuss and share our
experience, insight and passion for the subject with you. Leave a message to have Regional Sales Director of the UK, Ness Diwan, get in touch.




Solving the challenges with mobile NFC Payments – Part 2

As discussed in Part 1 of this blog post, mobile NFC payments have some challenges. This post will look at how wearable payments work and how they can meet these challenges.

Enter wearables

In October 2015, Mastercard and NXP announced something that might have been the start of the solution: New Program that can Turn any Wearable into a Payment Device. Following this, several announcements have been done on wearable or IoT payment (like this, this, or this). While several of these are quite distant for the average consumer, the wearable device payments are already here.

Especially two major challenges can be met with wearable payments: iOS support and speed at checkout.

Payments using wearables basically works by provisioning the payment credentials onto the wearable device. This can be done during production, but only allows for simple, static, pre-paid solutions. However, by connecting the wearable to a mobile app and use the app as a proxy for credential provisioning, there are (almost) no limits to what cards possible to add. In addition, this allows for real-time lifecycle management of the credential stored on the device.

What does this mean?

    1. Remove the NFC block on iOS device. Even if your customer is using an iPhone, she/he can deploy payment cards on his wearable device through the open Bluetooth channel. During payment, she will use the NFC channel on his wearable, circumventing the close control Apple has put on their devices.
  1. Always at hand - literally. Paying using a wearable device, such as a smart watch, bracelet or even a ring, removes the need of finding the device in the first place. Tap your wrist or hand towards the payment terminal, and the purchase is performed within milliseconds. You can’t do it cooler - or faster!

Hype or future?

Obviously, payment through wearables has its advantages. The big question that remains whether it is only a hype, or if we actually will see people tapping their wrists to get their favorite sub on their way home from work.

Apple Pay through Apple Watch has been around for about three years. Even so, analytics report of a slow start. Similarly, Samsung Pay has been available on Samsung Gear devices since 2015. These solutions have had a limited list of supported Issuers, but as the list of supported Issuers is growing, the use is growing at high speed.

A user research conducted by Seqr showed that 61 % of all users wanted to pay with a wearable device. Furthermore, it showed that more than 70 % would have no worries about the security of such a solution.

MeaWallet has seen an increase in OEM vendors – well established as well as small start-ups – that reaches out to us to learn more about our offerings for wearable payments.

In summary, we see that wearable payments are coming, and we believe they are coming fast. We might be too far into 2017, but 2018 might prove to be the Year of Wearable Payments.

Do you want to learn more about wearable payments and what it can do for you? Click here to download a factsheet.

Our mission at MeaWallet is to help our clients simplify mobile payments and support implementation. Our team is passionate about the subject and continually looking at the evolution and trends in the mobile payments space. We welcome your comments or invite you to get in touch directly with us at 

How Does HCE Address the EMV Goals?

Before following up the last post about wearable payments, we serve you a guest post. This post will look into the HCE technology and how it relates to the EMV security standard. Written by Christian Maas at Mea's business partner ti&m, the original blog post can be found here.

Not a day goes by without new mobile payment apps popping up or the Original Equipment Manufacturers, also called OEMs, launching their own mobile wallets (Apple Pay, Samsung Pay, Android Pay) in additional countries. Especially Switzerland plays an interesting role by focusing on the payment solution TWINT to solve the local mobile payment needs. However, regardless of the payment app and underlying technology, all solutions need to balance usability and security in order to justify a valid business case.

This article introduces Host Card Emulation (HCE) as the standard technology stack for your Android-based payment app and addresses how it meets the main EMV (Europay International, MasterCard, and VISA) goals to ensure secure payments at the Point of Sale (POS).

Understanding the role of Host Card Emulation

HCE is the term used to describe the entire ecosystem of mobile payment solutions on Android-based devices, which do not have access to a Secure Element (SE) or a Trusted Execution Environment (TEE). Usually, SE and TEE rely on proprietary hardware security to store and access sensitive keys such as the Card Master Key (CMK), whereas HCE solves this by using mobile device software in combination with a remote server.

There are various stakeholders in the HCE ecosystem, which play an important part in providing a seamless and secure payment experience to the cardholder. Ranging from a secure payment app that builds the user interface to initiate a mobile payment, to a trusted Wallet Service Provider (WSP), and finally, a Tokenization Service Provider (TSP) that replaces the PAN with a payment token (DPAN).

Whenever we think of Host Card Emulation, we tend to focus on transaction flows rather on what “card emulation” actually stands for. The secure payment app is the equivalent to the card program that runs on the plastic card’s contact chip. As a result, the payment app ensures that a valid EMV transaction is sent to the Near Field Communication (read about NFC here) reader at the Point of Sale.

As EMV transactions evolved towards being recognized as the more secure solution compared to magnetic stripe based payments, all HCE participants, such as software and hardware vendors, card issuers and card schemes, have aimed for the same security levels and market acceptance.

Does HCE live up to the EMV standards?

The main goals of EMV are to reduce fraud by the following measures:

  • Validating authentication of payment card (chip),
  • requesting cardholder verification,
  • validating transaction integrity, and
  • using risk management parameters.

Validating authentication of payment card (chip):

This means it should not be possible to copy a payment card or compromise the application programs on the chip. How can HCE solve this issue?

  1. After installing on the mobile device, each payment app has its unique instance ID.
  2. Registering the payment app on the device includes the storage of a device fingerprint at the HCE wallet server.
  3. The provisioning of a payment token to the software/hardware key store of a mobile device results in a unique combination of payment app instance ID, device fingerprint, and DPAN.
  4. Before replenishing limited-use Session Keys (SKs), the HCE wallet server validates the combination of the provisioned payment token, payment app instance ID, and device fingerprint.

In essence, the previously described steps make it difficult for a fraudster to request valid SKs from the HCE wallet server for a payment app that resides on a different device.

Requesting cardholder verification

You should be able to confirm that you are the cardholder by a method that is either dependent on the POS, transaction amount or other attributes. EMV allows several Cardholder Verification Methods (CVMs): Cardholder’s signature comparison by the merchant, validation of the PIN by either the issuer or the POS terminal, or “no CVM” at all, in case of low value/risk transactions. Now, what does cardholder verification look like for HCE?

  1. Card-Like User Experience (CLUE) – the payment app follows the same user experience as a regular contactless payment: tap and pay. Depending on the country, card schemes and POS terminals, Low-Value Transactions (LVTs) sometimes do not require cardholder verification. For a High-Value Transaction (HVT), the cardholder still has to enter his PIN at the POS.
  2. Consumer Device Cardholder Verification Method (CD-CVM) – users can authenticate themselves to the device via a fingerprint scan, password or swipe pattern.
  3. Flexible User Experience (FLUE) – this is a combination of CLUE and CD-CVM, but not solely one or the other.

The listed categories above give issuers and banks a flexible set to build a payment experience, which is in alignment with their standards and risk tolerance.

Validating transaction integrity

It is important to make sure that the transaction is not altered on the way between POS, card network, and the card issuer. Apart from using various sets of encryption keys and transaction identifiers, HCE exchanges a payment cryptogram based on DPAN-derived SKs to validate transaction integrity on the issuer side.

Using risk management parameters

Each stakeholder within the EMV ecosystem should be able to apply risk measures. Which safeguards does HCE put into place?

  1. Fraud systems are able to inspect the frequency of SK replenishment. In case of malicious behavior, the HCE wallet server can suspend the DPAN and stop the renewing of SKs.
  2. The payment app can only hold a small pool of SKs which minimizes the number of offline payments (the device has no internet connection) the fraudster could potentially make.
  3. Only allowing the provisioning of payment tokens on mobile devices that provide certain security standards, e.g. version of fingerprint readers, operating versions, etc., will reduce risk as well.
  4. Velocity tracking of LVTs without HVT in between.

This list is not complete, but it gives an idea of options issuers and banks can use to lower the risk of their HCE wallet service.


HCE product companies constantly work on security concerns to maintain reliable payment solutions. It is a fast-growing market, which competes with the established OEM pays. However, competition is good, and in particular when it comes to security. It keeps the pressure high to not lose the cardholder’s trust.

Our mission at MeaWallet is to help our clients simplify mobile payments and support implementation. Our team is passionate about the subject and continually looking at the evolution and trends in the mobile payments space. We welcome your comments or invite you to get in touch directly with us at 

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Wearable payments – hype or the future?

Solving the challenges with mobile NFC Payments – Part 1

The history of contactless payments

Payments using NFC is nothing new - it is something we have been talking about since 2003/2004.
NFC is o
ften referred to as The radio frequency standard that could solve all problems, removing any friction from payments and removing all of the world’s checkout queues.

NFC has slowly grown popular in the form of the plastic card, but when we talk about NFC payments, I bet the average industry veteran will drift his, or her, mind to mobile NFC payments.

Mobile payments using NFC has almost been considered the Garden of Eden or the fountain of youth. And boy, has it been long expected; try do a search for “year of mobile payments”, and you will find no less than 35+ million results!

If I had a dollar for every time I heard that this year/next year will be the year of mobile payments, I’d rather be drinking Piña Colada at my private beach, rather than writing this blog post.

But something has happened. After the launch of HCE in 2013, Apple Pay and Android Pay in 2015, the avalanche of Issuer-HCE solutions launched in 2016,  in 2017 to date, I think we finally can say that mobile payment based on NFC has reached some sort of a maturity and market acceptance. Alas, the offering and acceptance vary from market to market, but the standards are set and the world is moving unified in one direction.

Solving The Challenges of Mobile NFC payments

Mobile contactless payment is in many ways a great answer to several challenges: the user “never” forgets his/her phone at home, you can combine multiple cards in one device, it makes the Issuer look forward-leaning and modern, and it provides a sense of coolness for the one using it. But even as mobile contactless are being spread, it still comes with some challenges.

Personally, I’ve been meeting with Issuers countless times the last five years, and I’ve also had first-hand experience with the eight different wallets I’ve installed and use on a regular basis. In short, the issues and concerns I’ve heard about or experienced are:

    • iOS support - only for the selected few in the selected markets that are willing to accept Apple’s terms
    • SWW - SWW, or “Something went wrong” is unfortunately still a problem. With a myriad of devices, standards, payment terminals and user expectations to the speed of tap & pay, the user still ever-so-often will experience that “something went wrong”.  
  • Speed at checkout counter - Some Issuers require the user to unlock their phone, find and open app, select card, and type in PIN before they can tap - it’s not always as easy as just tap-and-pay with your contactless plastic

So how can these challenges be solved? This will be discussed in Part 2 of this blog post about wearable payments. 

Our mission at MeaWallet is to help our clients simplify mobile payments and support implementation. Our team is passionate about the subject and continually looking at the evolution and trends in the mobile payments space. We welcome your comments or invite you to get in touch directly with us at 

Money 20/20 Europe

Money 20/20 - Our thoughts on Europe's biggest FinTech Conference

We’ve reached June, and this is the month of the biggest FinTech event in Europe: Money20/20 Europe. As the interest in FinTech has increased (watch trend below), so has the number of conferences covering the subject. MeaWallet is invited to about 80 conferences this year alone. We attend quite a few, but for MeaWallet, Money 20/20 definitely has a major focus.

Money 20/20 was first arranged at the Aria hotel in Las Vegas, October 2012. Mea was there with several representatives. This was the arena we were first introduced to the concept of HCE. The technology HCE revolutionized mobile payments when it was launched in Android KitKat a year later. Symptomatic to the conference the top executives and the brightest heads in the FinTech industry gathers. This is where to go if you want to understand what happens before it happens.

A quick look at the agenda might help understand why. 5 separate tracks running in parallel over three days, with 65 % C-level speakers makes the speaks worth to listen to. The attracted audience includes more or less everyone that’s interesting to talk to if you’re in the business, which makes this one of the most hectic week of the year, packed with meetings in between the selected speaks.

This year, MeaWallet will be present at booth G2 with our management, sales team and product team. If you are interested in hearing more about how our Token Platform can connect you to MDES and VTS, or just want to discuss mobile payments, drop by, or contact us to set up a meeting.

Only 3 weeks left! Come see us at #M2020EU this month! Register with code EXTRA200 to save on your pass