The recent announcement from Apple, that it is now diving head long into mobile commerce, was universally embraced by many of us in the industry.
At first glance, some of the steps that Apple is taking, such as integrating NFC chips into its Apple Pay Services, and its support of EMV, can be seen as bold affirmations of the many recent innovations that have entered the market. The challenge is how to deliver this technology in as non-disruptive a manner as possible, in ways that preserve the flexibility to support multiple standards, and with minimal cost.
One such method to carry merchants forward is to rely on cloud-based architecture to transparently handle all the complexities associated with different payment presentation methods, acceptance options, and processor requirements. Through these offerings, providers are finding a number of benefits, such as better security and reliability, superior flexibility, and the ease of delivering new features and services. For providers and merchants that are facing the introduction of NFC and EMVand its potential of massive disruptionthe prospect of utilizing new technology to ease this integration could not come at a better time.
The superiority of a cloud architecture for payments is predicated on a reliable and flexible gateway that can act as intermediary between thousands upon thousands of terminals and data centers that actually manage the authentication, and ultimately, the processing of payments.
Cloud-based services and the cloud itself have matured in stability, reliability, and security in recent years. This is particularly true in the payments and mobile commerce markets where the control and security of sensitive financial and transactional data are paramount. The cloud provides universal access to the very best technology not only for processing payments, but for securing transactions.
Gateways can virtually exist anywhere through the highly sophisticated diversity and replication practices of cloud platform providers, and this virtual existence delivers reliability and security that is difficult, if not impossible, to attain in dedicated on-premise gateways. Cloud-based payment gateways deliver a cost-effective and flexible alternative that makes sense for merchants and processers across the globe.
A good gateway can support virtually any type of payment acceptance endpoint, including all types and makes of legacy made-for-purpose dial, IP, and wireless terminals, smartphones, and even browser-based endpoints such as flip phones, and of course, computer terminals for e-commerce based transactions.
An effective gateway must be able process multiple transaction types, including EMV chip-and-pin and chip-and-signature paymentsdepending on the geography, NFC payments, QR codes, and, traditional card swipe, which can originate from legacy terminals or through magnetic stripe readers connected to audio jacks on smartphones and tablets. Cloud-based architectures generally lend themselves to open and flexible use models, but in the payments world this flexibility also has to be maintained within the bounds of the security requirements of the global payments ecosystem.
Responsibility for endpoint security and compliance is shared between terminal providers and merchants, but security of sensitive data in flight is provided by the gateway. Hosting the gateway in the cloud provides the reliability and flexibility needed to deliver effective and secure transactional services. All pertinent data, including card numbers and personal details, are fully encrypted and secure.
While a flexible and secure gateway is critical for serving the needs of the merchant, all the system intelligence actually resides in the cloudor the secure data center that serves as the brains of the operations. Cloud environments, such as Microsoft Azure, for example, are data centers that exceed PCI security mandates, and are able to seamlessly manage new requirements like EMV, and even NFC payment processing requirements.
These cloud environments offer state-of the-art security, and have been certified by regulatory agencies and financial institutions for their robust security and reliability. In addition, these cloud environments transcend geographic borders to provide services and connectivity between endpoints throughout the world in ways that enable compliance with local regulations and practices while delivering the latest technologies and capabilities.
By using a cloud infrastructure, acquirers and merchants are relieved to find that they can continue to maintain compliance with industry standards while adopting new technologies such as EMV and NFC whenever it makes business sense. The requirement to upgrade terminal equipment is still in the picture, but with cloud-based gateway solutions, all of the technology modifications necessary to keep up with the latest developments are transparently made in the cloud, and then delivered to the endpoint through the gateway.
Its true, there are a lot of changes underway in the payment space. But, change doesnt necessarily equal bad. By leveraging secure, reliable gateway services, and a cloud-based architecture, providers can help their merchants ease through these transitions, which will result in tighter security, more flexibility for businesses and consumers, and more efficient use of resources.
Bill Nichols is president and CEO of AnywhereCommerce.
