Stakeholders Driving Payment Evolution and Digital Identity

September 2007 ACTion Newsletter

IN THIS ISSUE

1. Editorial Comment
2. Interac Association Marks Payments Industry Milestone With First Interac Chip Debit Card Transaction
3. First MasterCard Chip Transaction Signals Readiness For Roll-Out Across Canada
4. RBC Waves In A New Era Of Contactless Payments
5. Electronic ID Document Markets To Approach $1 Billion By 2012 - Members Only Access
6. Giesecke & Devrient And Route1 Pursue OEM Distribution Agreement
7. Canada Developing New EFT, E-Banking Guidelines
8. Citi Exec Bullish On NFC, Lukewarm On Contactless Cards And Fobs - Members Only Access
9. Oberthur Card Systems Announces One Of The First Cards That Meets Qualifications For Windows Vista, Common Criteria And FIPS Security Standards
10. Industry's First Commercial NFC Mobile Pos Deployment For A Social Care Project Launched In The Netherlands - Members Only Access
11. Infineon Provides Security Chips For Largest US Patient Smart Card Project
12. ACI And IBM Collaborate To Support Core Payment Systems Refresh
13. UK Telcos Launch Mobile Payments System - Members Only Access
14. Gemalto Minidriver Now Microsoft Certified And Windows Ready
15. Canadian Bank Customers Mostly Go For Convenience - Members Only Access
16. Big Mac Order Kicks Off RBS Contactless Rollout
17. New 3-In-1 Oyster Card Combines Cashless Payment With Travel Smart Card - Members Only Access

ACT CANADA THANKS OUR NEW & RENEWING MEMBERS

GENERAL

IBM Canada ~ new member
Paragon Application Systems ~ new member

SME

A LA CARD Marketing & Consulting Services ~ member since 2004

UPCOMING EVENTS

Smartcards in Transport
October 1 & 2, 2007
Paris, France
http://www.groupeactis.com/rubrique.php3?id_rubrique=48

Smart Card Alliance Annual Conference
October 8 - 11, 2007
Boston, MA, USA
http://www.smartcardalliance.org

Cardware Connections Meeting
October 30, 2007
OBA Conference Centre, Toronto, ON, Canada
This event is open to all retailers, ACT Canada members and other invited stakeholders. Retailers can meet other stakeholders who will be able to provide them with information and assistance as they consider their options.

Cartes & IT Security
November 13 - 15, 2007
Paris, France
http://www.cartes.com

1. EDITORIAL COMMENT
Source: Catherine Johnston, President & CEO, ACT Canada (09/27)

If Only I Had…

a tool that would make me more successful. Have you ever thought that?

Our ability to succeed is based in large part on the tools we have at our disposal and by how well and willingly we employ them. Good education is one tool, but it is usually expensive and formal education tends to stop when we are starting our careers. Ironically, one of the best life-long tools is free. It is something we can and should employ throughout our entire lives and use to foster success not only in our careers, but in all aspects of our lives.

It is a tool that when used by us gathers information. When others use it, it helps us become more articulate and provides us an opportunity to review our thoughts. This powerful and affordable tool is "the question".

It sounds too simple, but everyday we are faced by questions of how, when, why, where, who and what. When making decisions we have the question of, "is this the best way or would further information provide a better way?"

When I was starting in the information systems world, my first employer said I was hired because I had no trouble asking questions, a trait I learned from my earlier days as a journalist. Some people fear that they won't know the answers, but every question can be an opportunity to seek out new information.

In a world where "we don't know what we don't know" it is the infrequently asked questions that can help the most.

ACT Canada will be helping EMV stakeholders and identity management stakeholders focus on key questions in the coming months. After all, there is an abundance of information on the web, but the key is in asking the question that will get you the accurate, timely and "in context" answer. Let us help you frame the questions. Why - because your success is important to us.

2. INTERAC ASSOCIATION MARKS PAYMENTS INDUSTRY MILESTONE WITH FIRST INTERAC CHIP DEBIT CARD TRANSACTION
Source: Interac Association (09/12)

As part of its commitment to providing the safest and most secure payment network, Interac Association announced the completion of Canada's first INTERAC debit card transaction at the point-of-sale terminal using chip technology. The transaction was processed by TD Merchant Services using a BMO Bank of Montreal chip debit card at Mercato Giovanni's Fresh Food located in downtown Toronto. The chip debit card transaction was conducted in preparation for the Kitchener-Waterloo, Ontario market trial of chip technology which will begin in fall 2007.

"The successful processing of the first INTERAC chip debit card transaction represents great progress and brings Canada one step closer to the chip migration," said Mark O'Connell, President and CEO, Interac Association. "We look forward to working with our members and partners throughout the Kitchener-Waterloo market trial towards a smooth transition to chip technology across Canada."

Beginning in fall 2007, merchants and cardholders will start to see the introduction of cards, Automated Banking Machines and merchant terminals that feature chip technology, and within three years, it is expected that the majority of Canadians will be able to fully benefit from this new technology.

The complete migration to chip technology will take a number of years, given the vast number of Automated Banking Machines, point-of-sale terminals and banking cards across Canada which must be upgraded. Each financial institution has its own timetable in place, so the introduction of chip technology will vary from one participant to another.

Interac Association is a member of ACT Canada; please visit http://www.interac.org.

3. FIRST MASTERCARD CHIP TRANSACTION SIGNALS READINESS FOR ROLL-OUT ACROSS CANADA
Source: Canada Newswire (09/252)

A simple payment transaction made today at a Toronto-area spa and salon marked an important milestone in the introduction of chip cards in Canada. It was the first chip and PIN transaction made with a Canadian MasterCard chip card in a real world retail location. The transaction was made with a BMO Mosaik MasterCard at Tresses Spa and Salon on a Moneris point-of-sale (POS) terminal.

The transaction demonstrates the advanced state of readiness for the roll-out of chip cards and devices. A major market trial of chip cards will take place in Kitchener-Waterloo, Ontario in a few months time and is a precursor to the national roll-out of chip cards.

"Chip cards take payment cards to the next level of technology with greater capacity and enhanced security," explains Kevin Stanton, President, MasterCard Canada. "The impact on consumers' daily experience is minimal - entering a PIN instead of signing a receipt - but the benefit for the security of payments is great. And today we saw another significant milestone achieved with the first MasterCard chip and PIN transaction."

MasterCard Canada is a member of ACT Canada; please visit http://www.mastercard.ca.

4. RBC WAVES IN A NEW ERA OF CONTACTLESS PAYMENTS
Source: Canada Newswire (09/17)

RBC is introducing Visa payWave(TM) a new contactless payment feature that will give busy consumers a fast and convenient way to pay for small purchases. RBC customers will begin receiving the Visa payWave feature on their RBC credit cards during the chip market trial starting next month in Kitchener-Waterloo.

"As the first Canadian FI to offer nationally a credit card with chip technology we're pleased to be at the forefront of another new technology," said Anne Koski, head, Payments Innovation. "Visa payWave will make getting through checkout lines much quicker while providing the extra layer of security of a chip."

RBC's contactless feature will be easy, and not require a separate card or key fob. The Visa payWave feature will be part of RBC's chip credit card that can be used for traditional credit card payments as well as contactless payments.

Visa Canada Association is a member of ACT Canada; please visit http://www.visa.ca.

5. ELECTRONIC ID DOCUMENT MARKETS TO APPROACH $1 BILLION BY 2012

Available in the ACT Canada Members Only section of our web site. Click on the link below to access this section.
http://www.actcda.com/members-only/members-only-news/

If you are a member of ACT Canada but do not have your login details please contact me - andrea@actcda.com.

6. GIESECKE & DEVRIENT AND ROUTE1 PURSUE OEM DISTRIBUTION AGREEMENT
Source: Giesecke & Devrient (09/24)

Giesecke & Devrient (G&D) and Route1 Inc. announced they have entered into a Letter of Intent (LOI) to conclude an OEM Distribution Agreement by the end of October 2007 enabling Route1's suite of identity management subscription services to be integrated into G&D's StarSign® product family for e-identity tokens.

G&D is a security technology company that has set worldwide standards in this field from the beginning. Through intensive research and development work, G&D has continued to lead the way into the research and development of new, successful, and future-oriented solutions in the security arena. G&D's desire to implement Route1's technology into its family of products is based on Route1's patent-pending MobiNET™ platform. The agreement between Route1 and G&D will see the integration of both companies' solutions initially targeting the private and public sectors and financial institutions.

Giesecke & Devrient is a member of ACT Canada; please visit http://www.gi-de.com.

7. CANADA DEVELOPING NEW EFT, E-BANKING GUIDELINES
Source: ePaynews (08/30)

The Government of Canada is seeking to protect consumer rights with the establishment of a new voluntary code for electronic funds transfers (EFT) and electronic banking. The Federal Department of Finance has invited industry representatives, consumer groups and provincial governments to participate in a working group to develop the new rules.

"This new working group will look into new electronic payment methods and see how the protection of consumers can be enhanced," Jim Flaherty, Canada's Finance Minister, says in a news release.

The new code will build on the existing Canadian Code of Practice for Consumer Debit Card Services (debit card code) which was introduced in 1992. The Government believes that it is needed because of new payment systems such as Interac Online, which enables consumers to shop online by setting up direct debits from checking accounts.

Interac Association is a member of ACT Canada; please visit http://www.interac.org.

8. CITI EXEC BULLISH ON NFC, LUKEWARM ON CONTACTLESS CARDS AND FOBS

Available in the ACT Canada Members Only section of our web site. Click on the link below to access this section.
http://www.actcda.com/members-only/members-only-news/

If you are a member of ACT Canada but do not have your login details please contact me - andrea@actcda.com.

9. OBERTHUR CARD SYSTEMS ANNOUNCES ONE OF THE FIRST CARDS THAT MEETS QUALIFICATIONS FOR WINDOWS VISTA, COMMON CRITERIA AND FIPS SECURITY STANDARDS
Source: Oberthur Card Systems (09/20)

Oberthur Card Systems is proud to bring to market one of the first ID-One smart card compliant with Microsoft smart card specifications.

The ID-One Classic smart card has been developed specifically to respond to the increased security requirements expressed by business and governmental agencies. The solution has obtained the most stringent security certifications on the market: Common Criteria EAL 4+ SSCD protection profile certification for secure electronic signature and FIPS 140-2 Level 3 certification as required by the US Department of Defense.

Windows Vista integrates functions dedicated to smart-card management, such as Smart Card Base CSP and Smart Card KSP. The link between Windows Vista and the smart card must be provided by a mini-driver (middleware) designed to Microsoft specifications.

Compliance of mini-drivers with Microsoft specifications is validated through the Windows Smartcard Framework Certification Program. Oberthur Card Systems worked in close liaison with the Microsoft test center based in Dublin, Ireland throughout the "Logo Ready" pilot phase of this program.

The ID-One Classic smart card offers to its users the following services:
Reinforcement of security when connecting to a private network or a website, because two factors - the smart card and a password - are mandatory to be authenticated.
Increased confidentiality of exchanges thanks to the possibility of coding e-mails using the cryptographic keys contained in the card.
Officialization of electronic documents thanks to the possibility of signature using the certificates contained in the card.

Automatic integration of smart card in Windows Vista should help speed up adoption by the market - it makes the card as simple to install and use as any Windows peripheral.

The ID-One Classic mini-driver offers an opportunity to easily upgrade any information system to smart card-based security along the deployment of Windows Vista. In addition, the qualifications it has met guarantees that ID-One Classic cards are compatible with all Microsoft identity-related offerings and integrate seamlessly into the Microsoft "trust ecosystem."

Oberthur Card Systems is a member of ACT Canada; please visit http://www.oberthurcs.com.

10. INDUSTRY'S FIRST COMMERCIAL NFC MOBILE POS DEPLOYMENT FOR A SOCIAL CARE PROJECT LAUNCHED IN THE NETHERLANDS

Available in the ACT Canada Members Only section of our web site. Click on the link below to access this section.
http://www.actcda.com/members-only/members-only-news/

If you are a member of ACT Canada but do not have your login details please contact me - andrea@actcda.com.

11. INFINEON PROVIDES SECURITY CHIPS FOR LARGEST US PATIENT SMART CARD PROJECT
Source: Infineon (09/10)

Infineon Technologies announced it is the sole chip supplier for the largest patient healthcare card in United States. Siemens, Mount Sinai Medical Center and Elmhurst Hospital Center have formed a health smart card alliance to deploy up to 1.2 million Patient Health Smart Cards to link as many as 45 affiliated and related medical facilities in the New York metro area. The patient health smart card trial has begun late 2006 and is scheduled to end in 2007. In 2008, the health smart card alliance expects to issue approximately 500,000 smart cards which integrate a highly secure Infineon microcontroller.

The patient health smart cards are issued by the affiliated and related medical facilities with the patient's printed photo. To use the card, the patient inserts the card into a card reader and enters a private, personal identification number (PIN) to unlock the data on the smart card security crypto-controller. The crypto-controller securely stores the demographic data for the patient, including name, gender, contact information; allergies; current medical history; and lab results. The patient card is based on the Health Card Solution of Siemens and meets the US Food and Drug Administration's requirements for Class 1 medical devices that are mandatory to introduce medical products or services.

"The ideal concept of having integrated care across all hospitals and institutions will take a while," said Doris Hermann, Vice President and General Manager, Security and Identity Management, Siemens AG. "Using a smart card is a way in between. Because first you have the advantages of data on the card, then we can help hospitals to gradually migrate towards even more sophisticated IT concepts."

"Compared to the current method of using paper documents, smart card technology improves administrational efficiency and patient safety by providing accurate medical data and insurance coverage information," said Dr. Helmut Gassel, Vice President and General Manager, Chip Card and Security ICs, Infineon Technologies. "Infineon is committed to serving the health card industry. This program has the potential to further initiate patient smart cards throughout the US."

Today, Infineon provides its secure microcontroller chips to the world's largest national patient cards, health insurance cards and social security cards, including Italy, Taiwan, Slovenia, Spain, India, Poland, Great Britain, and Germany.

The Patient Health Smart Card initiative uses a smart card operating system (OS) of Siemens. This OS is embedded onto the highly-secure contact-based Infineon smart card controller SLE 66CX680PE. The high-performance crypto-controller features an integral security concept providing multiple levels of physical protection and encryption and is certified according to Common Criteria "EAL 5+ high" certification. It offers 68 Kbytes of EEPROM, 196 Kbytes of ROM, and 4 Kbytes of RAM.

Infineon is a member of ACT Canada; please visit http://www.infineon.com.

12. ACI AND IBM COLLABORATE TO SUPPORT CORE PAYMENT SYSTEMS REFRESH
Source: ACI Worldwide (09/10)

ACI Worldwide announced that they are collaborating with IBM to help customers plan and implement upgrades to their legacy payment systems to take advantage of the newest generation of application software from ACI. The company's BASE24-eps™ solution is the focus of the ACI/IBM efforts.

BASE24-eps was the subject of an IBM Redbook in 2006, providing detailed information about how the software is deployed on IBM's z/OS platform. IBM has now published a supporting Redpaper that details the considerations to be taken into account by customers as they plan for when and how to undertake a migration to BASE24-eps as their engine for consumer payments processing.

Financial institutions are under increasing pressure to upgrade legacy payment systems to keep pace with the growth in electronic payments volume, regulatory changes, and obsolescence of technology. The combination of BASE24-eps on IBM System z offers a secure and powerful high-availability solution for supporting business growth while taking advantage of modern software architectures and the reliability and stability of IBM's hardware and software platform. In addition, BASE24-eps complements ACI Payments Manager™ on System z to automate back office functions and leverage IBM's virtualization strategy to lower operating cost.

ACI Worldwide & IBM Canada are members of ACT Canada; please visit http://www.aciworldwide.com & http://www.ibm.ca.

13. UK TELCOS LAUNCH MOBILE PAYMENTS SYSTEM

Available in the ACT Canada Members Only section of our web site. Click on the link below to access this section.
http://www.actcda.com/members-only/members-only-news/

If you are a member of ACT Canada but do not have your login details please contact me - andrea@actcda.com.

14. GEMALTO MINIDRIVER NOW MICROSOFT CERTIFIED AND WINDOWS READY
Source: Gemalto (09/18)

Gemalto announced that corporations can now deploy SafesITe Classic Trusted PKI cards working in a Windows minidriver configuration. This simplified and convenient method uses a Windows Smart Card Framework minidriver that is Microsoft® Windows® ready. This follows Gemalto's successful completion of a new Microsoft pilot certification program dedicated to smart card minidrivers.

"Gemalto's SafesITe Classic Trusted PKI cards are designed to protect digital identities and secure data," said Cédric Collomb, senior vice president, Identity and Access Management (IAM) solutions, Gemalto. "The availability of the minidriver allows convenient and low cost deployment and management of the cards."

Microsoft has made smart card support available through its Windows Smart Card Framework on Windows 2000, Windows XP, Windows Server™ 2003 and Windows Vista™. This allows organizations to easily deploy smart cards by downloading the minidriver from Microsoft Update. To test and certify minidrivers, Microsoft has developed a certification program in its Dublin, Ireland-based development center. Gemalto's successful completion of the certification program means the SafesITe Classic minidriver fully supports the Microsoft Windows Smart Card Framework and is available on Microsoft Update.

The SafesITe Classic Trusted PKI card solution is certified with the "Designed for Windows" logo for card minidrivers and smart cards, and meets the Windows Vista program requirements for smart card minidrivers.

The SafesITe Classic Trusted PKI card is the second Gemalto smart card compliant with Microsoft's Windows Smart Card Framework, joining the Gemalto .NET smart card, whose minidriver is included in the box with Windows Vista and packaged in a Windows update for Windows 2000, Windows XP and Windows Server 2003.

Gemalto is a member of ACT Canada; please visit http://www.gemalto.com.

15. CANADIAN BANK CUSTOMERS GO FOR CONVENIENCE

Available in the ACT Canada Members Only section of our web site. Click on the link below to access this section.
http://www.actcda.com/members-only/members-only-news/

If you are a member of ACT Canada but do not have your login details please contact me - andrea@actcda.com.

16. BIG MAC ORDER KICKS OFF RBS CONTACTLESS ROLLOUT ROYAL BANK OF SCOTLAND
Source: ePaynews (09/04)

Royal Bank of Scotland (RBS) has teamed up with McDonald's to launch its contactless cards in the UK. An AT&T Williams racing car driver made the UK's first public contactless card payment on August 24 at a McDonald's drive-thru in London. The driver used an RBS MasterCard PayPass-enabled debit card to buy a Big Mac.

McDonald's says that 12 of its London restaurants will be accepting contactless card payments by the beginning of October 2007. "Eventually, we hope to roll contactless technology out further across the UK," Ivan Brooks, McDonald's UK Vice President, Chief Information Officer, says in a statement.

RBS has also signed up other retailers including wine store chain Oddbins and cafes, delis, pharmacies, bars and sandwich shops in London to accept contactless cards. These retailers will start to use contactless technology from September 2007, RBS says.

In early November 2007, RBS will start issuing several hundred thousand contactless debit and credit cards to its customers who live or work in the London roll-out area.

Since June 2006, RBS has been carrying out internal trials of contactless credit and debit cards involving staff and retailers at its offices in London and Edinburgh. It says that, so far, employees have made 52,000 contactless purchases.

17. NEW 3-IN-1 OYSTER CARD COMBINES CASHLESS PAYMENT WITH TRAVEL SMART CARD

Available in the ACT Canada Members Only section of our web site. Click on the link below to access this section.
http://www.actcda.com/members-only/members-only-news/

If you are a member of ACT Canada but do not have your login details please contact me - andrea@actcda.com.

For more information, please contact Andrea McMullen at 1 905 426-6360 ext 124 or email andrea@actcda.com.

Please forward any comments, suggestions, questions or articles to andrea@actcda.com. Please note that articles contained in this newsletter have been edited for length, and are for information purposes only.