Smartcards aim to increase transaction safety

August 2002 Access Control & Identity Management

Credit card fraud and shrinkage are two of the biggest bugbears facing retailers. However, as the smartcard begins to find favour in the retail sector, a host of additional security features are about to be ushered in.

Pierre Kotze, financial services executive at Integrated Card Technology (ICT), the smartcard manufacturer in the NamITech stable, said smartcards are effective in combating two major types of fraud: counterfeiting, where genuine data is acquired and encoded on a fake magnetic stripe card; and lost and stolen cards. According to Kotze, smartcards also put an end to the problem of cards not being received by bank customers, which are known as not received items (NRI). This happens because they have either been lost or stolen during the process of delivery.

Recognising the importance of chip technology to the future of the plastic payments industry, Europay International, MasterCard International and Visa International joined forces to facilitate the migration to smartcard technology.

The result was the integrated circuit card (ICC) specification for payment systems, known as the EMV ICC specification for payment systems.

With these specifications in place, said Kotze, the three card associations have paved the way for universal acceptance of chip-based transactions for credit, debit or ATM cards.

"Smartcards," said Kotze, "come with a myriad of advantages which can be of benefit to the retailer. When using a magnetic stripe credit card, the cardholder's signature is commonly used as verification. However, even the most diligent of merchants do not like inspecting cardholder signatures in detail; it creates a feeling of mistrust, and in some countries is regarded as socially unacceptable. If a mismatch is suspected, the confrontation is a personal one between the cashier and the cardholder. There also is no way to show whether or how thoroughly the check was done. Therefore, retailers are looking to chip to provide the route towards an objective, and preferably automatic, cardholder verification method such as the personal identification number (PIN). So a criminal with a lost or stolen card would need to know the PIN before the card could be used. PIN will ultimately yield to biometric information like a fingerprint minutia on the smartcard as that technology becomes more widespread and more economical."

Commenting further, Kotze said credit card issuers can remotely disable a stolen card, reducing the reliance on merchants' confiscation - and on their systems. Merchants sometimes disregard confiscation requests during a transaction, meaning the cardholder can use the card again at another location. "By instructing the POS terminal to disable the card that has been reported stolen, issuers can curtail fraudulent use without relying on store clerks."

Kotze adds that besides advantages to the retailer, smartcards also give the bank control over the actions of their cardholders by controlling the number and/or value of transactions that can be completed off-line, without compromising security, prior to the requirement of an authorisation.

For more details: NamiTech, 011 458 0000.




Share this article:
Share via emailShare via LinkedInPrint this page



Further reading:

Managing staff effectively
September 2019, dormakaba South Africa, iPulse Systems , Integrated Solutions, Access Control & Identity Management
Workforce management solutions allow organisations to track the relationship between productivity and the cost of employment, incorporating issues such as health and safety, T&A, rostering and more.

Read more...
Hennie Lategan joins Centurion as head of exports
September 2019, Centurion Systems , News, Access Control & Identity Management
Centurion Systems has announced the appointment of Hennie Lategan as the head of the company’s exports department.

Read more...
New AlproMAX7 secures maximum rating
September 2019 , Access Control & Identity Management, Products
Alpro has launched a new range of ultra-secure mechanical mortice deadlocks, the AlproMAX7 which comply with BS EN 12209.

Read more...
ViRDI UBio Tab 5
September 2019 , Access Control & Identity Management, Products
ViRDI Distribution SA (ViRDI Africa) has announced the release of its long-awaited UBio Tablet to the South African market.

Read more...
Visitor access control at Ruimsig Country Club
September 2019, Elvey Security Technologies , Access Control & Identity Management, Products
Cost-effective access control solution that would control the ingress and egress of people, without hindering the traffic throughput of members.

Read more...
Estate-focused visitor management solution
September 2019, Vox Telecom , Access Control & Identity Management, Residential Estate (Industry)
Vox has expanded its cloud-based visitor management solution to cater specifically for the needs of small multi-dwelling unit estates and large residential estates.

Read more...
Biometrics control airport railroad
September 2019, Suprema , Access Control & Identity Management
63 km railroad to Incheon Airport is centrally controlled and secured by Suprema biometric hardware and software.

Read more...
Dual energy X-ray inspection system
September 2019, Regal Distributors SA , Products, Access Control & Identity Management
The ZKX6550 X-ray inspection system increases the operator's ability to identify potential threats; the device is designed to scan briefcases, carry-on baggage, small cargo parcels.

Read more...
ZKTeco parking barrier
September 2019, Regal Distributors SA , Products, Access Control & Identity Management
The PB3000 parking barrier is an ideal automatic car park barrier for parking lot and security control; it can easily integrate with revenue collection and access control systems.

Read more...
ZKTeco automatic bollard
September 2019, Regal Distributors SA , Products, Access Control & Identity Management
The high-quality automatic bollard is used to protect security areas from vehicle intrusion; in case of power failure, the bollard can be lowered manually.

Read more...