E-Purse spec for smart cards to be published

A specification that aims to allow the world's electronic-purse programs to work together will be published on December 30, according to a group of companies that have been working on the standard.

Electronic purses are small software applications that store monetary value and are usually packaged on a smart card. The money stored in the purses can be used for making purchases at shops, vending machines, pay phones or for electronic commerce.

For years, conflicting standards on smart cards issued by competing financial institutions have prevented electronic-purse applications from working together. The publication of the Common Electronic Purse Specifications (CEPS) is a major step forward in creating a global standard for electronic-purse transactions, said a statement issued by some of the major financial institutions involved in forming the standard. Those companies include Europay International, Visa International, Visa Espana/SERMEPA and Germany-based Zentraler Kreditausschuss (ZKA).

The industry group believes the publication of the standard will help to further the growth of smart cards worldwide, said Sophie Renaud, manager for electronic purse at Europay International.

Conflicting standards in the past meant that vendors had less incentive to accept smart cards for payment, because they would have to sign up to accept a number of competing smart cards, Renaud said. This required a huge investment to purchase and maintain separate card-reader terminals for each of the proprietary cards.

The momentum to create a uniform standard has been building since June, when the world's largest purse operators created the working group to develop CEPS. Then in September, CEPS was bolstered when Europay, Mastercard International's European partner, agreed to support the Visa-backed CEPS, effectively removing the last barrier to global interoperability for smart cards.

"With the countries that have joined, we cover 90 per cent of the purses issued today. There is now no obstacle to having CEPS being implemented worldwide," said Renaud.

Most electronic-purse developments are taking place in Europe, said Renaud. And although electronic purses are used mainly in Europe and Asia now, Renaud believes the US will eventually adopt them as well. And when they do, she said, they will use the CEPS standard. "Why would they develop something from scratch? It will become accepted as a worldwide standard," she predicted.

CEPS defines the requirements needed by an organization to implement a globally interoperable electronic-purse program, including the card application, the card-to-terminal interface, the terminal application for point-of-sale transactions, data elements and recommended message formats for transaction processing.

Once the evaluation period is complete on January 31, a final version of the specifications will be made public.

More information the CEPS project can be found on the Europay Web site at http://www.europay.com

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