SINGAPORE, 22 OCTOBER 2008 -- Customers can avoid sending personal data over the internet when shopping online, following the launch of a new e-commerce payment system.
Collaboration between MasterCard, Formosa Technology, FarFax and Shin Kong Commercial Bank has resulted in the Credit Card Dynamic Password Authentication and Dynamic Secured Payment System.
According to MasterCard, the system is the first of its kind in the Asia-Pacific, using the MasterCard OneSmart Chip Authentication Program (CAP) and Credit Card Personal Account Number mapping.
With the solution, customers can make online payments without having to enter personal data such as a credit card number, expiry date, cardholder name and three-digit CVC2 code, MasterCard said. The user only needs to enter the CAP token and complete payment authorisation upon confirmation of identity.
Online shopping popularity
Online shopping has attracted the interest of more Asia-Pacific consumers, reflected by a jump in electronic transactions. According to MasterCard, the Asia-Pacific online shopping market is expected to grow at a rate of 23.3 per cent annually, reaching US$168.7 billion by 2011.
Despite the growing popularity of online shopping in the region, users still cite information security as a top concern, MasterCard said.
Formosa Technology and FarFax will work with participating internet merchants to deploy the Credit Card Dynamic Password Authentication and Dynamic Secured Payment System platform.
According to MasterCard, the system improves information security by offering two-factor authentication on EMV chip technology. This means that the customer would employ something only he or she knows, such as a PIN, in tandem with something he or she has (an EMV chip card in this case).
Cardholders insert their EMV chip card into a simple handheld card reader, and enter their PIN into the device, creating a unique, one-time password, MasterCard said. The password must be entered to permit the user to conduct online banking or e-commerce transactions.
Based on EMV and CAP technologies, the password only works once and becomes invalid when the transaction is completed.
MasterCard claimed that the system gives internet users peace of mind from Trojans or hackers intercepting personal information such as account numbers and passwords. By eliminating customers' need to provide personal information to merchants, identity theft may be prevented, the company said.
For the near future, Formosa Technology is seeking to extend the system to online shopping, online auction and television shopping merchants.
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