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Making Payments Via Cell Phones

Making Payments Via Cell Phones

Cell PhoneThe announcement on 16 December by the board of the UK Payments Council that cheques are to be phased out by 2018 has heightened the need for secure replacement payment systems.

New security technology developed at Oxford University by Professor Bill Roscoe and his team that allows people to make payments via mobile phones, offers a solution.

The technology is designed to work in almost all situations: person to person, in a shop or restaurant, at a vending machine, online, or as part of a telephone conversation.

Isis Innovation, the University of Oxford's technology transfer company, is working with Professor Roscoe to commercialise the technology.

'A key requirement of new payment systems will be the ability to make payments from person to person, such as paying a builder or a friend,' said Professor Roscoe of Oxford University's Computing Laboratory.

'What we have is technology which enables anyone to easily create a secure connection between two devices: it can work via Bluetooth, WiFi, the internet or across ordinary telephone or SMS connections.

'The core of our technology is a new security protocol that enables strong cryptographic keys to be created with the least possible work. The key to the protocol is that it prevents anyone from doing any searching to break into the transaction.'

The Oxford technology uses a system in which the payer checks whether a short numeric code (4-8 digits for most applications) generated within their own phone is the same as the one generated by the payee. This number is random and does not have to be kept secret.

This ensures that the customer's mobile is connected to the correct store, or to the mobile of the person they wish to pay. Payment then occurs without the exchange of sensitive details such as credit card numbers or PIN.

It is expected that no hardware modifications to the phones will be needed, and the Oxford team have built demonstration systems to show a variety of uses. The payment itself could be made in a number of ways: using electronic cash or credit stored on a mobile phone, via authorisation of a credit card payment, or by instructing a bank to pay a merchant or another person a certain amount.

Source: University of Oxford

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