Payment Card Construction
The discussion focused on the construction of the sandwich. Four layers. Clear front laminate to protect the ink, front with the banks design and brand logo, back with the banks back design and a clear laminate with the magnetic stripe integrated into it.
To enhance design additional layers may be added, such a metal foil.
These four sheets are then bonded together, at 120 degrees, in sheets of 21, 36 or 48 or other various sheet sizes. Next step punch out cards, add hologram and signature panel.
For a standard EMV card the next phase is to mill and embed the module with the chip inside. Last, the manufacturer typically loads the O/S & EMV application into the integrated circuit card.
When we move to dual interface caed, this process is modified to add an inlay, with the antenna embedded within. This inlay is inserted in the middle of the sandwich and during the embedded process the contacts exposed on the base of the module are connected to the antenna in the inlay.
Next step, personalization, when the appropriate data is loaded into the chip, along with the encoding of the magnetic strip and printing and/or embossing of the cardholders, name, expiry date, cvv2 and other information onto the card.
Contactless or Not That is a Question
Contactless NFC acceptance and dual interface issuance is all about the chicken and the egg. Who will go first? The merchant or the issuer? Each need each other. Both are wondering about the incremental value.
- Faster transactions – Yes
- Less cash – maybe
- More revenue – good question!
Given these questions and observations, one can only wonder.
The associations expressed support for draft legislation released by Reps. Blaine Luetkemeyer (R-Mo.) and Carolyn Maloney (D-N.Y.) that would create a level playing field of nationally consistent data protection standards and post-breach notification requirements. This bill would not create duplicative standards for financial institutions which are already subject to robust standards, but rather extend similar expectations to other sectors that handle consumer data.
“The goal of the bill is simple — raise the bar so that all companies protect data similar to how banks and credit unions protect their data, and create a common-sense standard to ensure consumers receive timely notice when a breach does occur,” the groups wrote.
The draft bill contains a provision that recognizes the existing, effective regulatory framework for covered financial sector entities. While the provision was intended to prevent banks and credit unions from being subject to duplicative notification requirements, it has been the target of recent negative campaigns circulated by the National Retail Federation and the Retail Industry Leaders Association, which incorrectly suggested that banks do not notify customers of breaches on their computer systems and The ads from the retailer groups also mischaracterize and exaggerate the share of data breaches occurring at banks and credit unions while omitting their members’ (higher) share of data breaches.
The financial trades refuted the notification assertion, noting that “banks and credit unions have long been subject to rigorous data protection and breach notification practices for financial institutions to follow,” and that in the event of a data breach, banks and credit unions work continuously to communicate with customers, reissue cards and enact measures to mitigate the effects of fraud. They added, however, that “no solution will work unless everyone has an obligation to take these steps.” For more information, contact ABA’s Jess Sharp.
A few weeks ago I learned of the Sovrin Foundation a foundation interested in establish a concept to support the idea of a self Sovereign means of identity.
As an advocate for stronger forms of identification and more important Authentication I am pleased to have received your response today.
Back in 1993 I was part of Europay and drove the creation of the EMV specifications as a form of Authentication and frankly reflecting back a strong form of Identification with the Trust Anchor being the Financial institution issuing the card and the foundation anchor being the payment network that the issuer used to assure acceptance globally.
In 2013 I joined the Board of the FIDO Alliance and eventually become the Secretary of that Board.
Today I am engaged with a company called IPSIDY, that is promoting and selling Identity as a solution.
Clear the conversations we are having include:
- Device based versus centralized biometric authentication
- Identification based on a central repository of Biometrics or a simply identifier linked to a means of authentication
- Claims and assertions one points (URL) to or those that one has in their own possession
- Repositories or Distributed databases of information
- Privacy of attributes and rights to defining what can be shared
When I ask about the future of Sovrin, I hear people saying great concept how does it scale to be useful.
This, as was my experience in the Payments world, is the challenge of a two sided market
- Consumer – Merchant
- Individual – Rely Party and those seeking attributes and proofs of identity
The challenge is developing a value proposition and more importantly critical mass that will excite both sides of the market to want to participate.
To further complicate developing the market is the challenge of the “Go To Market” strategy. Who does one partner with given that the usefulness to the citizen/consumer is predicated on the number of parties or places this solution, token or Identity with a set of sharable attributes can be usefully used.
This is the question this is the challenge.
Identifier – Something you create or are provided to digitally identify yourselves. Identifiers are things like an alias, user name, email address are examples.
Identity – This is who we are or wish to represent ourselves to be. These are attributes and information about: where we live, who we work for, which banks we have relationships with, who our friends are, which clubs we belong to, our certified skills, what schools we graduated from, which country(s) we are citizens of, our LinkedIn profile, Our Twitter handle, our Facebook identifier, our phone number … . It is the sum of the attributes we can and will share with others, be they individuals, governments, entities or organizations; as we establish relationships and prove to them who and often what we are.
Authentication – The method we employ to assure that you, based on the identifier presented, are who we (the relying parties) thinks you are. You are the person the relying party accepted when you registered that Identifier as how you would digitally identify yourself. By itself the method of authentication should not allow another party to be able to determine anything about your identity. Privacy is the goal. FIDO Alliance and W3C have defined standards to support authentication.
Verification – The process of confirming that the secret or biometric match the secret or biometric that where originally registered to that Identifier.
Identification – A means of authentication that is bound to your identity. A EMV payment instrument “Chip and PIN”, a PIV card, an electronic passport, a membership card, a drivers license, a national ID are all forms of identification issued by a party that should be trusted to have performed a proof of the individuals Identity, based on a defined and often published criteria.
This particular word, for many, has an alternate meaning. In the biometric community they see Identification as the ability to use a biometric to determine ones Identity. This is achieved by performing a one (the person present) to many match (persons registered). The goal is the same, bind Identity to the mean of Authentication by using the Biometric as the Identifier.
Proof – The method a relying party or an individual uses to validate your claim of a specific Identity. In many cases this is achieved by relying on knowledge of another party. The relying party accepts the due diligence to proof your claimed identity was done to their satisfaction by another party. This other party is often referred to as a Trusted party. This effort to proof the identity of an individual is linked to words and acronyms like KYC “Know Your Customer”, ID&V “Identity and Verification” and Self Sovereign Identity. We classically assume that documents provided by a Government e.g. drivers License and Passports are a solid proof of the claims asserted on those same documents.
In a digital world this is the most important element of a how we as people, entities, governments and corporations can be assured that you are who we believe you to be.
I am once again am reminded of the 1994 New Yorker Cartoon
The idea of voice many see as one of the more interesting biometric solutions as seen from an ergonomic perspective and something that can readily enhance the call center consumer experience and related security. The user simply needs to say something into a microphone (telephone) and presto they can be identified or authenticated.
But is it a safe and secure approach or simply the starting point for the identification and therefore associated with additional authentication processes.
Personally I am not convinced a voice is a good solution to the challenge of authentication. Yes, as one element of a multi-factor multimodal approach it is an excellent modality. But not as the only biometric modality. My fear emerged from a conversation with a sound engineer. She told me they could, at the level of a single vowel, splice and change the intonation of a word in a movie sound track.
The above article clearly identifies real world examples of voice biometrics being fooled and concludes by remind us that a multimodal solution is essential.
Classic Multi-Factor Authentication wants to pair multiple unique and none replicable elements together.
- Some thing you have
- Some thing you know
- Something you are
When I think about multi-factor authentication I wonder what would happen if the object “what you have” can be stolen. This therefore means the second factor must to assure that only the legitimate user is presenting the object. If a mime can replicate a voice, after stealing the object, then, this combination of factors can be compromised.
EMV, when implemented as Chip and PIN, matches a unique chip card (what you have) with a PIN (what you know). Apple Pay is EMV and stores the secrets and executes the cryptographic functions, inside hardware, the Secure Enclave (what you have) and combines this with a sensor to capture the Biometric (what you are). The electronic passport ICAO use similar chips and carries within it a facial image. The US PIV & CAC cards uses the same style Chip and are paired it with a fingerprint and sometimes also requires the user to enter their PIN.
Yet are they truly secure? We know Apple X’s, facial recognition, as currently implemented, can be fooled. We know that Touch ID was spoofed. Without liveness testing, most if not all biometrics, will accept a clone or replica of the biometric it employs.
The challenge is establishing the appropriate benchmarks for the various biometric implementations such that enterprises, governments, merchants and corporations can select and implement a consumer experience that satisfies the needs of security and convenience.
Acronyms like FRR, FAR and PAD become critical to selecting the appropriate implementation of a biometric solution.
- The False Reject Rate or FRR is all about convenience and not refusing the legitimate user. Perfection is a ratio of 0 in ∞
- The False Accept Rate or FAR is all about not approving a transaction or event by an imposter. Perfection is a ratio of 0 in 1
- The Presentation Attack Detection or PAD is all about addressing the reality that anything can be duplicated; therefore it is essential to make sure the biometric presented in alive and genuine. Perfection is a ratio of 0 in 1.
The challenge is establishing a balance between the cost and the acceptable FRR, FAR and PAD.
Measuring and establishing the test results of a particular element of a multi-factor solution is not cheap. EMV, PIV, ICAO software and “Secure enclave” / “Chip Card” / “Secure Element” suppliers spend 100’s of thousands of dollars developing and certifying the functional and security characteristics of the “what you have” element of these solutions. We know that passwords and PIN can and have been compromised with Phishing attacks and hidden cameras.
When we think about biometrics there is complexity in the read and match processes. When the user established their identity and their biometric the reference template is create. This reference template is then used in the matching process to identify if template resulting from the biometric just presented, is the same. Unfortunately reality dictates that each presentation of the user’s biometric will generate a unique result. This unique result will never absolutely match the reference template. Hence the need to understand and test the sensor and establish its FRR, FAR and PAD. The more foolproof the match must be, dictates the complexity of the solution and the number of different individual needed during the test process to establish the sensors FRR, FAR and PAD.
Therefore selecting the most appropriate solutions means quantify the risk of the event or transaction and measuring it against the cost and certified characteristics of the authentication mechanisms.
A layered approach that combines two or more factors must also considered including multiple modalities for at least the “what you are modality” is what we must consider. Using cryptography and hardware to address what you are, Passwords and demographic information to match what you know and layering various elements like location, behavior and some set of biometrics to understand who you are, will offer the highest level of security with the lowest degree of inconvenience.
Bottom Line Multi-Modal & Multi Factor
Authentication of Identification is what we must implement
Always mindful a modality will lose its ability to assure uniqueness
I always enjoy reading the words David writes.
This particular post creates a moment to reflect. As we consider the implications of the Fourth Industrial Revolution, we must remember the significance many have attributed to Artificial Intelligence. Those two letters AI are clearly key to the what, why and wherefore of the change ahead.
Clearly machines that work faster, search deeper and are capable of studying vast realms of data are changing the nature of so much. Simply consider the risks to our security cyber hackers and terrorists wrought on this world or the shenanigans many claim the Russians use to disrupt as they explore and exploit the power of social media.
Moreover as we look afield many industries are being disrupted: movies, books, music, news … to name few. Outsourcing and robotics is changing the nature of work and the skills necessary to compete and ultimately survive to enjoy the pleasures available in our increasingly digital world.
David makes the point that the intelligence Isaac Asimov and other science fiction envisioned has not yet emerged. I think he is right. The message I take aware -we who market these solutions should walk forward with care.
People are clearly feeling threatened by the change impacting their towns, families and livelihood.
We must be mindful that complexity breeds confusion. Confusion drives disillusion. This then causes people to react, often in nonsensical ways.
Take On Payments
Federal Reserve Bank of Atlanta
Posted: Nov 27, 2017 10:51 am
At the recent Money20/20 conference, sessions on artificial intelligence (AI) joined those on friction in regulatory and technological innovation in dominating the agenda. A number of panels highlighted the competitive advantages AI tools offer companies. It didn’t matter if the topic was consumer marketing, fraud prevention, or product development—AI was the buzzword. One speaker noted the social good that could come from such technology, pointing to the work of a Stanford research team trying to identify individuals with a strong likelihood of developing diabetes by running an automated review of photographic images of their eyes. Another panel discussed the privacy and ethical issues around the use of artificial intelligence.
But do any of these applications marketed as AI pass Alan Turing’s 1950s now-famous Turing test defining true artificial intelligence? Turing was regarded as the father of computer science. It was his efforts during World War II that led a cryptographic team to break the Enigma code used by the Germans, as featured in the 2014 movie The Imitation Game. Turing once said, “A computer would deserve to be called intelligent if it could deceive a human into believing that it was human.” An annual competition held since 1991, aims to award a solid 18-karat gold medal and a monetary prize of $100,000 for the first computer whose responses are indistinguishable from a real human’s. To date, no one has received the gold medal, but every year, a bronze medal and smaller cash prize are given to the “most humanlike.”
Incidentally, many vendors seem to use artificial intelligence as a synonym for the terms deep learning and machine learning. Is this usage of AI mostly marketing hype for the neural network technology developed in the mid-1960s, now greatly improved thanks to the substantial increase in computing power? A 2016 Forbes article by Bernard Marr provides a good overview of the different terms and their applications.
My opinion is that none of the tools in the market today meet the threshold of true artificial intelligence based on Turing’s criteria. That isn’t to say the lack of this achievement should diminish the benefits that have already emerged and will continue to be generated in the future. Computing technology certainly has advanced to be able to handle complex mathematical and programmed instructions at a much faster rate than a human.
What are your thoughts?
By David Lott, a payments risk expert in the Retail Payments Risk Forum at the Atlanta Fed
A presentation provided at the December United States Payment Forum to an audience of 50 plus individualsUSPF-Dec-2017- Identity_and_Payments
Words to ponder as we think about the best way to secure our digital persona.
Identifier – A text string we use to uniquely identify ourselves to a relying party, person, government, employer, club or entity we wish to have or need to maintain a relationship with. This group of entities hereafter will referred to as a replying party.
Identity – We each are unique and have attributes
Verification – A process the entity we seek to establish a relationship with uses to determine the truth of the attributes we share. One could argue this is or should be a mutual process. Many call this identity verification or identity proofing.
Registration – When we take these three words identifier, verification and identification and think about the first time we present ourselves to a relying party in the global digital environment. We typically present ourselves through a user interface to the entity we are interested in establishing a relationship with. We register and the relying party creates a record of our existence. They seek to recognize and record our identity.
This process typically requires us to invent or the relying party to present us with a unique identifier and agree to identify ourselves with this unique string, often called a user name, email address, bank account number, social security number, employee id, passport number, drivers license number or payment (card) account number ‘PAN’. The ultimate goal of registration is for the relying party tonassure themselves we are unique and that the attributes we share are linked to our person. They verify our identity.
Today the challenge is to find an efficient, convenient and none intrusive method of Verification.
Authentication – We exist, we can be recognized and are able to present oneself over and over again to the relying party, using our identifier. The challenge is how do we prove or assure our identity to the relying party each time. We need to authenticate ourselves.
Identification – Many confuse the dialogue above with this word. The difference is how we present ourselves or better said how the relying party expects us to present ourselves.
With the wide use of biometrics and many of the identifier we spoke of earlier, our identifier many not simply be some random string. A biometric is personal and linked to our body or actions. This biometric can be converted into an identifier and therefore once accepted as genuine and integrates the act of authentication into recognition of our identity.
Certain identifiers create a level of assurance, because the relying party trusts the attributes it asserts based on who issued that identifier. They are willing to trust in our identity and associated attributes because of the verification done by the isuing party. It a passport, an employee id, bank card or a drivers license. The instrument has characteristic, privileges and attributes linked to the issuing party, not simply attributes associated with the individual.
As we move from a physical world to a digital world. As people seek to use our identity to present themselves as someone they are not. As we seek to separate the various relationships we establish. Requires that we find ways of assuring our privacy while securing our relationships. All this demands we find more secure methods of authentication that are convenient.
With David Birch We asked the Question. Identity – Authentication – Identification – Authorization and ultimately verification, where are we.
Simple. We have the technology. We have the standards and more are coming. Authenticate, is done, use FIDO.
Identification with Biometrics is illuminatingly possible. Even the one I know how to spoof, Voice, with other factors layered in, does the job very well.
The challenge is Privacy and Confidentiality must be inherent while regulatory practices must be incorporated.
Today Wednesday October 18, 2017. I had the opportunity to provide the closing keynote to the EPCOR Annual Payments conference. Today, I was reminded of the reality that payments is not only about cards it is the engine that fuels the revenue of a financial institution. ACH, Wires, Cards, checks, transfers and even cash are revenue earning services; our community banks call payments.
My speach was about the future and focused on the evolution of our phone in this new digital age we all must learn to embrace.
Created in December of 2011 as I reflected on the emergence of the Cyber Risk
My identity is mine electronic or otherwise
I will be prudent in its use
I understand if I enter into an agreement that you can prove it was me
Then I am responsible
I will carry with me an object that can be kept safe from intrusion and can easily be remotely destroyed
You, those entities human and other that I enter into a relationship with
Can offer me anything I am willing to opt-in to
Using a defined set of cryptographic relationships
I agree that a digital contract can be signed and agreed and has the full force of the law behind it
You will recognize that I am your human equal and will,
Save for acts of God and Nature,
Endeavor to provide quality and service
INCREASING EMV CARD AND TERMINAL DEPLOYMENTS CONFIRM EMV AS GLOBAL PAYMENT STANDARD
06 October 2010: As of 1 September 2010, over one billion EMV®* cards and 15.4 million EMV terminals were active globally. These are the latest EMV deployment figures reported by EMVCo, the EMV standards body collectively owned by American Express, JCB, MasterCard and Visa.
Interesting that as soon as you identify that I should be able to provide my identity to anyone anywhere you state that a national government can offer such a scheme. That is counter intuitive and fraught with the issue of achieving global standards of identification, given the bureaucracy of most national governments.
Yes, ICAO was able to agree on a template and specification for the e-passport. Fortunately they had a template and various agreements and treaties to justify the work. But when we start out with the basic premise that my identity is how I wish to project myself; we immediately move into a world of nuance with built in mechanisms to embrace and resist change. That being said Homo sapiens’ have a perchance to employ tools we morph as society and our world evolves.
Picking the right band of stakeholders to assure universality requires that at some point people abandon the idea that there is Profit in defining how we will digitally represent a person’s identity. Instead because the consumer/citizen wishes to project or required to provide their identity; we leave it to those seeking to receive the information to find the profit in knowing something about me.
Having been raised in America I am drawn to the words in our declaration of independence that give us the right to life, liberty and the pursuit of happiness. Behind these words I believe I also have the right to my privacy and do not want to learn that morphing my identity into a digital form puts my identity at risk. The citizen/consumer must be able to decide when and what information someone is able to scan.
All of this tempers my thinking about who should be engaged in defining the global standard for digital identity.
The two-way street
I could not say it better myself. Like my business card, a police persons badge or a company id card. We present these to each other to create trust between various parties and provide a degree of certainty that:
· I am who I say I am
· This is how you can locate and communication with me
· Here is proof that I have the following rights and capabilities
Very well said the exchange of information about my identity must be as easy as handing you my business card. Everything after that is about the context of the transaction and will parallel the discussion and negotiations between the parties.
My only addition to the supposition that the phone is the right gadget is the reality that we are talking about something that the citizen must be able to carry most anywhere. So it must be the one object we always carry. Some would argue this is the mobile phone; I would suggest that we not forget the more primitive device the purse or wallet. Maybe as we think of identity we must also think of ergonomists and think about merging the phone into the wallet not the wallet into the phone. Leather is eco-friendly warm and comfortable to the touch. Metal or plastic tends to be brittle and cold.
The next thought in respect to the gadget is it becomes the device I trust and will protect at almost any cost. Should I worry about how trustworthy your device is? All I want from you is the information you wish to share and any certificates others provide you that allow me to authenticate your rights and capabilities. My trusted gadget is what I use to share information and certificates and what helps me absorb and as appropriate verify information and certificates others offer to me.
Yes my information is mine and what I offer to others is my choice.
I am not convinced of the need for a central register. Yes there is a need for third parties to attest to the citizen’s identity that others can trust and in lies the complexity of introducing a digital solution. In fact what the citizen needs is a device they trust. A device we trust, carries the information and certificates that third parties, who the counterparty trusts, capable of exchanging the appropriate digital data electronically. In order to achieve this goal we must develop and support a cascade of standards, regulations, contracts and relationships that enable global interoperability thus assuring a meaningful means of exchanging our digital identity.
Before we go about defining the techniques that should be employed, I think we must first establish base principles. Key must be the idea that there is no centralized register. Instead those parties we as consumers are willing to trust and wish to position themselves as trusted third parties can build registries, recording those individuals they are willing to authenticate. The citizen may wish to contract with an entity to provide support for the trusted gadget and the various relationships it supports.
The author’s position on protecting privacy and meeting the needs of law enforcement is laudable yet scary. I’d rather the protection offered by a distributed environment that still is capable of responding to directed queries from law enforcement and not blanket access to everything I or others have collected about me.
Make my gadget the gate keeper; allow service providers and those parties wanting the security of digital identity the ability through standards to build affordable infrastructure to read, with my permission, data stored in my gadget. Avoid the complexity of establishing a global resister. What we need to define is the architecture for a gadget that is capable of carrying and supporting a myriad of digital relationships with their linked need to assure proper identification. We then need to agree on a common set of information that all sectors share. Maybe the v-card is the base.
For more information I offer the following background and a concept for consideration.