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Is E-zwich internet payments ready?

Posted on 09. Jan, 2010 by Nana Kwabena Owusu in Biz + Tech, Real Tech

E-zwich is one of my favorite projects in Ghana because it aims to provide a single platform for banking and financial transactions. A single platform makes my heart leap with joy because on several occasions when I stupidly tempted fate, by leaving home with just enough money to get me to a Visa ATM. The sheer number of  ATMs in the Visa network have saved me, time and again.

The important emphasis is on network because if Visa was restricted to a single bank I would have been deeply embarrassed. With E-zwich I would probably have had several more options and that’s the power of a single standard platform.

Invariably as we progress E-zwich will have to include online payments and this is where I was beginning to doubt if E-zwich is future proof. E-zwich uses a chip based smartcard and uses biometric (fingerprint) information for authentication. This differs from the usual PIN based systems we use for our current ATM and debit cards.

In its current state E-zwich is a chip only platform meaning all transaction must be done using a device which authenticates the user’s fingerprint.  Although there are examples of personal devices capable of reading and authenticating users remotely being used, it is technically challenging, inconvenient and costly and that route is therefore closed.

My questions in this regard were simple and can be paraphrased as following.

1. Can E-zwich be used for internet payments?
2. Why isn’t an internet module implemented currently and what options are there for a future rollout?

I tried getting my answers from the Ghana Interbank Payment and Settlement Systems Limited (GhIPSS) but their email (info@ghipss.com) was not working and maybe I should have tried some phone calls but I instead tried Net1 , the technology solutions partner for GhIPSS and I got my answers, funny enough, through an email from their CEO. Net1 implements E-zwich using their proprietary Universal Electronic Payment System (U.E.P.S.) technology.

Long Live email!!

I will quote and summarize the most important sections of the email and how it answers my questions.

1. Internet Payments & Future Integration

Actually this is a bigger issue better classified under Card Not Present (CNP) transactions. Net1 prefers UEPS solutions to avoid the pitfalls and security issues of PIN based Card Not Present (CNP) transactions by using a channel mutually exclusive from the card. The internet would therefore become the mode for intiating and finalizing transactions but not the means of payment would effected. A perfect mutually exclusive  channel for Ghana would be mobile phones, which are widely available and not internet based, removing common internet payment security risks.

Net1 has a product called a  Virtual Credit Card (VCC) which is designed to perform card not present transactions. It requires no modifications to any websites, their online payment acquirers or the switches used to route the transactions to the issuing banks. Another plus is that a VCC transaction is handled as just another type of UEPS transaction within the E-zwich platform and therefore requires no drastic changes to the current system.

Here is a direct quote from the CEO’s email regarding Virtual Credit Cards from Net1.

VCC generated on a Point of Sale (POS) could be validated with fingerprints (UEPS function – Ghana); This of course would require some leg work from the customer that would need to go to a POS to generate the VCC in the first place (no cell phone).

The same could be achieved on the cell phone using a secure UEPS PIN.

The resulting VCC is then entered as a “Card Not Present” transaction on the Internet or any other CARD NOT PRESENT enabled POS in Ghana such as hotel reservation, airline bookings, car rentals etc.

The VCC transaction can provide standard information required to process online payments

The VCC will contain the relevant Bank Identification Number in respect of routing purposes. This application, (VCC) if required in Ghana could be run by the Central bank of Ghana with one or two BIN Numbers (Visa/MasterCard) allowing them to provide this functionality to all Ghana’s banks’ and their customers.

2. Why isn’t an internet module implemented already

The strategic decision lies with GHIPSS and I think E-zwich should have been implemented with this already active.

Regarding your enquiry about future Internet payments – this is obviously the strategic decision of the GhIPSS team managing e-zwich in Ghana.

However as Brenda Stewart states below it is perfectly logical (irrespective of how I personally feel on the Now versus Later argument)

The UEPS system is modular and a client i.e. Bank of Ghana, typically select which UEPS modules/applications/products and services they wish to deploy.

This is normally carried out in a Phased Approach selected by the client, as a UEPS national system is a huge operational rollout and it is wise to implement it in a Phased Approach.

Well since I am not a CEO and also believe the issues can be dealt with successful without much disruption, I hereby declare E-zwich, Internet Payments Ready.

Ps. Thanks to Brenda Stewart

Pss. No,I don’t have any authority to certify E-zwich.

Related posts:

1. Fraud. Is it a valid excuse for banks not embracing online payments?
2. Month of Electronic Payments: TxtNpay
3. Month Of Electronic Payments: eTranzact Ghana
4. Month of Electronic Payments: MTN MobileMoney

Tags: card not present, e-commerce, ezwich, Ghana, ghipps, internet, net1, payments, RealTech, strategy, ueps, virtual cards