FIDO Munich Seminar In-Vehicle Payment Trends.pptx

Editor's Notes

1. Overview of three key topics and then deep dive
2. So, how is this growth of digitalisation affecting the automotive industry? What is the change in behaviour and key trends? – People are now buying cars online and they expect a seamless customer journey What is the impact on car manufacturers? The automotive industry is moving away from the traditional three-tiered sales model (franchise model) to an integrated online-offline sales model OEMs interact with customers directly and take responsibility for the sales transaction, therefor the dealer acts as an agent This enables car manufacturers to leverage existing dealer assets in order to provide a superior omnichannel customer journey With agency sales, OEMs establish a 360° customer view 3. From Visa’s point of view, this highlights the growth in ecommerce and the need for a seamless payment experience
3. Now we are in the second hot topic Here, connected car is defined as a car that can be linked to other services and devices via a network (Connected Car. Its history, stages and terms. | BMW.com) They can connect to your phone, via Bluetooth, connect to GPS with its own dashboard sat nav system, or connect to the internet, from an internal SIM (Connected cars – everything you need to know | RAC Drive) They are quickly increasing in numbers as part of the larger Internet of Things (IoT) ecosystem This is an opportunity to leverage Visa’s products and solutions for in-car payments, specifically our tokenisation services
4. Stricter regulation is a fact and regulations are popping up all around the world to protect the customers PSD2 as the driver, regulations getting stricter and increasing around the world Therefore, a secure and trustful infrastructure needs to be built which is compliant to PSD2 and increasing regulatory requirements outside of EEA Symmetric to Apple Pay which always make us of 2-factor authentication and works in the same way independent of payment regulations (SCA) in the specific market Visa capabilities are helping automakers meet PSD2 compliance requirements in the EU market Cloud Token Framework enables the vehicle to act as an SCA trusted device through device binding Visa Delegated Authenticator Program allows in-car digital wallet to act as delegated authenticator Mercedes and Visa launched PSD2-compliant in-car payments solution in March ‘23 Solution is available in Germany and will roll out in other European countries later this year Mercedes acts as delegated authenticator on behalf of issuers Drivers can complete an in-car purchase via built-in fingerprint sensor
5. Visa has several products supporting tokenisation, currently we are offering solutions based on VTS and CTF. These solutions come under Visa’s standard product offering, Token Management Services 1. VTS, FIDO, and Visa Secure are the prerequisites for the solution VTS is initiated by a token requestor which are entities who initiate the process of tokenisation – For example, in the Mercedes Pay case, Starfish is the token requestor that sits in-between Visa and Mercedes Pay FIDO (Fast Identity Online) enables consumers to use their on-device biometrics to provide authentication – In the Mercedes Pay case, Cariad (VW subsidiary) provides this technology Visa Secure authenticates the cardholder – In the Mercedes Pay case, Logpay (VW subsidiary) is PSP 2. CTF links the payment credential to the customer and their device/s – Binds the device to a token 3. VDAP allows digital customer authentication within a merchant or digital wallet environment – Authentication on behalf of the issuer, liability lies with the merchant 4. DAF is a Global Commercial Fraud Liability Framework based on risk. Participant assists with the authentication, providing additional data and flags to the issuer via DAF indicator, Visa qualifies the data, and assigns Acquirer Liability Protection – Liability lies with the issuer *It is important to note the VDAP component is being repositioned as part of DAF so it will not be shown explicitly in the future 5. Pass-Through Wallet stores Visa PAN data provided by the cardholder, and during payment the wallet transfers the data to the PG/merchant *This picture will evolve as new market solutions are developed (e.g. FIDO and biometrics)