In one of the first such trials in the world, around 5,000 Barclaycard customers are now being issued with a small stand alone card reader device that can easily fit in a pocket or wallet to use alongside their chip and PIN credit and debit cards. Typically, while shopping online, users will be prompted to authenticate themselves to the Web site in question by inserting their card into the portable reader and tapping in their four-digit PIN. The reader and the card then generate a unique dynamic password, which is then entered when prompted on the Web page. By entering a 'one time only' dynamic password the impact of that password being compromised is greatly reduced.

Between 35-40% of all credit card losses result from 'card not present' transactions. In an effort to address these levels of fraud, this approach delivers the level of security and therefore confidence in this form of online transaction that is at least equivalent to that associated with a face to face or 'card present' transaction, as there is a strong linkage between the cardholder and the card making the payment. This technology can also be used to raise the bar for access to online banking and other services. The recent spate of phishing attacks, for instance, would be rendered futile since the benefits of capturing passwords would be negated if passwords are non-reusable and therefore worthless thereafter.

nCipher's payShield product is a secure hardware security platform designed for use with MasterCard's Chip Authentication Programme, with significant benefits to cardholder security and information assurance. Leveraging the security provided by EMV chip cards, payShield provides the "host side" authentication mechanisms to enable an issuer to strongly authenticate its customers for the purposes of making payments or to access any online service.

"For a card authentication solution to be truly effective in a non face-to-face environment, it has to offer a high level of security , and be low-cost and consistent across multiple channels. The MasterCard Card Authentication Programme is designed to address these concerns and by working with experts in their field such as nCipher we are able to offer an online experience that is both safer and fast and can therefore help issuing banks greatly reduce online credit card fraud and phishing attacks" says Fikret Ates, Vice President, Chip Product Management at MasterCard International.

"Barclaycard is pleased to continue its history of successful innovation by trialling this technology" said Dave Taylor, Senior Product Manager at Barclaycard. "Allowing for the secure authentication of our cardholders from wherever they happen to be breaks down critical barriers to e-commerce, making the shopping experience both more secure and convenient for consumers."

"Minimising the exposure of sensitive customer information such as card numbers and PINs to both internal and external threats is a critical requirement of a highly secure online payment solution. We are excited to be able to work with MasterCard and Barclaycard to provide a solution that delivers the level of security demanded by MasterCard International and its member banks in their efforts to reduce financial risk and build confidence for online customers," said Ron Carter, Payments Product Manager at nCipher.