Mobile Payment Forum of India Technology sub-committee Presentation on mobile payments

2 Agenda Technology architecture Technology architecture Transaction flows Transaction flows Intra Bank transfer Intra Bank transfer Inter Bank transfer Inter Bank transfer Connectivity and Security Connectivity and Security Standards and requirements Standards and requirements Mobile ~ Mobile Banking Application Mobile ~ Mobile Banking Application Mobile phone application Mobile phone application Cost components Cost components

3 Technology architecture Transaction flow

4 Mobile Networks Bank Intra bank transfer Internet Mobile Banking Application / Service SMSC Gateway GPRS Gateway

5 Bank connects to Mobile networks via Mobile Banking Application / Service (MBAS) Bank connects to Mobile networks via Mobile Banking Application / Service (MBAS) Sender and Receiver perform a registration at Bank Sender and Receiver perform a registration at Bank MBAS stores card number, or account no and Bank ID MBAS stores card number, or account no and Bank ID Sender specifies a recipient Mobile number / account number and initiates a transfer request Sender specifies a recipient Mobile number / account number and initiates a transfer request MBAS performs checks and forwards the request to the Bank MBAS performs checks and forwards the request to the Bank Bank validates the From / To accounts, performs a fund transfer; responds to the sender and the receiver via MBAS Bank validates the From / To accounts, performs a fund transfer; responds to the sender and the receiver via MBAS Intra bank transfer - Transaction flow

6 Service offerings: Service offerings: For Bank’s customers only For Bank’s customers only Bank can offer unique services Bank can offer unique services Transaction processing and settlement Transaction processing and settlement Intra-bank transactions can be settled by the bank itself Intra-bank transactions can be settled by the bank itself Intra bank transfer

Bank 2 Inter bank mobile payment transfer Bank 1 Mobile Banking Application / Service SMSC Gateway GPRS Gateway Bank 1 Mobile Networks Internet Switch Transaction Switch ISO 8583

8 MBAS connects to the mobile networks, and connects to a Transaction Switch, which in turn connects to Banks MBAS connects to the mobile networks, and connects to a Transaction Switch, which in turn connects to Banks Same Sender / Receiver Registration process Same Sender / Receiver Registration process Sender (of Bank 1) specifies a recipient Mobile / account number of other bank (Bank 2) and initiates a transfer request Sender (of Bank 1) specifies a recipient Mobile / account number of other bank (Bank 2) and initiates a transfer request Bank 1 validates the From account, performs a debit and returns status to Switch Bank 1 validates the From account, performs a debit and returns status to Switch Switch sends the credit leg to Bank 2 Switch sends the credit leg to Bank 2 Bank 2 validates the credit account, and responds to Switch Bank 2 validates the credit account, and responds to Switch If invalid “To” account, sends a failure message to Switch If invalid “To” account, sends a failure message to Switch Bank 1 reverses the debit, sends out a failure message to Sender Bank 1 reverses the debit, sends out a failure message to Sender Inter bank transfer – Transaction flow

9 Service offerings: Service offerings: Transfer of funds across banks account Transfer of funds across banks account Purchase / payments Purchase / payments Transaction processing and settlement Transaction processing and settlement Intra bank transaction settlement by each bank Intra bank transaction settlement by each bank Inter bank settlement reports by Switch for settlement by Settlement Bank / or settlement Agency Inter bank settlement reports by Switch for settlement by Settlement Bank / or settlement Agency Inter bank mobile payments

10 Connectivity and Security Standards, requirements

11 SMS / GPRS connectivity SMS / GPRS connectivity HSM based authorization and key management HSM based authorization and key management PKI infrastructure and DUKPT between MBAS and the mobile PKI infrastructure and DUKPT between MBAS and the mobile Audit logs for at least 1 year at MBAS Audit logs for at least 1 year at MBAS Mobile ~ MBAS

12 Customer registration with bank required for availing Mobile Banking services; bank issues MPIN on secure stationery Customer registration with bank required for availing Mobile Banking services; bank issues MPIN on secure stationery Application initiation by password / PIN issued by MBAS provider Application initiation by password / PIN issued by MBAS provider Bank can consider imposing limits on transaction amount – customer wise or for the channel Bank can consider imposing limits on transaction amount – customer wise or for the channel Forced password change on first usage – for application / transaction Forced password change on first usage – for application / transaction Biometric authentication - nascent stage, early Biometric authentication - nascent stage, early Mobile phone application

13 SMS / USSD / CDMA / GPRS based technology are acceptable SMS / USSD / CDMA / GPRS based technology are acceptable Menu based applications using open standards on J2ME recommended Menu based applications using open standards on J2ME recommended Application download via OTA, IR or Internet Application download via OTA, IR or Internet Application invocation PIN at the time of downloading the application Application invocation PIN at the time of downloading the application Mobile phone application (contd)

14 Service offerings by Mobile operator Service offerings by Mobile operator SMS / GPRS / USSD SMS / GPRS / USSD Mobile Banking application on handset Mobile Banking application on handset Provided by application provider Provided by application provider Mobile Banking Application Server / Service Mobile Banking Application Server / Service EFT Switching / SFMS Messaging costs EFT Switching / SFMS Messaging costs NFT / FSS / SFMS NFT / FSS / SFMS Transaction processing costs at Banks Transaction processing costs at Banks Settlement costs Settlement costs CCIL / RTGS CCIL / RTGS Cost components

MPFI Technology sub-committee Thank you