Mobile Payment Forum of India Technology sub-committee

1. Mobile Payment Forum of IndiaTechnology sub-committee Presentation on mobile payments

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

3. Technology architectureTransaction flow

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

5. Intra bank transfer - Transaction flow • Bank connects to Mobile networks via Mobile Banking Application / Service (MBAS) • Sender and Receiver perform a registration at Bank • MBAS stores card number, or account no and Bank ID • Sender specifies a recipient Mobile number / account number and initiates a transfer request • 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

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

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

8. Inter bank transfer –Transaction flow • MBAS connects to the mobile networks, and connects to a Transaction Switch, which in turn connects to Banks • 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 • Bank 1 validates the From account, performs a debit and returns status to Switch • Switch sends the credit leg to Bank 2 • Bank 2 validates the credit account, and responds to Switch • If invalid “To” account, sends a failure message to Switch • Bank 1 reverses the debit, sends out a failure message to Sender

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

10. Connectivity and Security Standards, requirements

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

12. Mobile phone application • 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 • Bank can consider imposing limits on transaction amount – customer wise or for the channel • Forced password change on first usage – for application / transaction • Biometric authentication - nascent stage, early

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

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

15. MPFI Technology sub-committee Thank you