Sberbank preps SE and HCE mobile wallets
09 June 2014 | 8448 views | 7
Russia's Sberbank is preparing to introduce both Secure Element- and Host Card Emulation-based mobile NFC payment wallets in a decision that reflects the different "risk profiles" of the two technologies.
Testing of the Secure Element-based wallet is already underway in Moscow, with the bank working with manufacturers Samsung and HTC to embed the SE within the handset, rather than the SIM. Pilots of the HCE-based system will begin soon.
Both systems use recently launched digital issuance technology from Sequent Software, a US vendor in which Sberbank's VC arm, SBT Venture Capital, led a $12 million funding round last summer.
Sberbank's MD of digital ventures, Mircea Mihaescu, tells Finextra that the bank is not testing both secure element- and HCE-based wallets in order to decide which to launch commercially. Rather, the two are likely to be offered side-by-side because they have different "risk profiles".
Although cloud-based HCE has been gathering momentum and credibility in recent months, there are still questions about its security, with SE advocates such as the SIMalliance arguing that the new technology is inherently less safe.
The Sberbank SE wallet will have a higher transaction limit, says Mihaescu, reflecting the robust nature of its security while the HCE offering will be used for lower-value transactions.
Meanwhile, the bank hopes to encourage usage of the wallets by tapping into Sequent's APIs, which can give third party apps access to customer cards for payments.
The pilots are the first major exercise for Sberbank's new digital ventures unit, which operates outside the bank and is tasked with launching controlled experiments in the real world. Mihaescu stresses that, in this context, both pilots are formalities, "stage doors," to commercial roll outs.