The Moscow Social Card is being used as a pilot to measure the added value of dual interface smart card technology, combining credit/debit and social payments applications on a single card. Wendy Atkins reports on the scheme.

Bank-card technology is providing innovative opportunities for financial institutions to partner with a range of organisations to deliver their services. In Russia, the launch of a pilot of dual interface smart card technology within the Moscow Social Card marks the third phase of a relationship established between the Moscow government, the Bank of Moscow, Moscow Transport and Visa Russia.

The first social cards issued were hybrid, using contactless technology for transport and magnetic stripe technology for other applications. Then, in 2002, cards with an electron-branded banking application were issued. “This put 2.5 million participants in a quasi-bank environment, as all social payments are deposited through the Bank of Moscow,” says Denny Jensen, senior vice-president, Visa Smart Chip Readiness and Implementation.

Card combination

The latest phase, scheduled to begin this month, involves the deployment of a dual interface card that combines contactless transit with Visa Smart Debit Credit (VSDC) and social benefits applications in a single chip. The initial pilot is being rolled out to around 20,000 recipients who are considered technically savvy, such as students and workers.

Depending on the success of this, a decision may be made to roll the card out to about 2.5 million people. The pilot will be a test of general public acceptance of the entire card platform. The evaluation will examine whether or not there is enough added value to the cardholder in having all the functionality on one card, considering the additional expense of the dual interface card.

The Moscow government is driving the project because the card targets benefits recipients, who are not typically high-end bank customers. Roll-out requires every recipient to hold a bank account at the Bank of Moscow, which ultimately could change the financial habits of a previously large unbanked population. Way4, a front and back office real-time payments solution from Belgium-based OpenWay Group, handles payment processing at the Bank of Moscow.

Specific issues and concerns about cards involving a range of players from government and industry have to be addressed before the cards can be deployed successfully. In particular, partners have to reach agreements about who should pay for the card to be deployed, who should own the card and how cardholder privacy can be ensured.

In the case of the new Moscow Social Card pilot, GlobalPlatform keys control the card to ensure that only those with access rights can view or change the details held on it. Whoever is deemed the main owner of the card can establish a set of keys (known as security domains) that allows access to each application. These keys were provided through Rosan Finance, a Russian personalisation bureau and manufacturing facility that also acted as a trusted third party.

Political intrusion

Technically, there is no limit to the number of security domains that may be held on a card. However, logistical and management problems could limit the number of domains set because the greater number of partners involved, the more politics can enter into agreements.

“This is a key pilot, with several other former Soviet states looking at doing the same. These countries will be interested in the results from the point of view of fraud reduction, as well as reducing the number of unbanked citizens in the country,” says Denny Jenson.

“It will also help to create a valid list of citizens who are eligible for social benefits.”

Moscow social card project participants

  • Moscow Committee for Social Security
  • Moscow Underground
  • Moscow Railway
  • Moscow Compulsory Medical Insurance Fund
  • Department of Economic Policy and Development
  • Department of Consumer Market and Services of the Moscow Government
  • Bank of Moscow
  • Visa
  • State Enterprise ‘Moscow social register’

 

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