The Cellular Telephone Payment System

In July 2001, the payment initiatives Movilpago (developed by BBVA and Telefónica Móviles) and Pagomóvil (promoted by SCH, Vodafone and Amena) were unified, giving rise to the creation of a common platform with the name of Mobipay.

In order to develop and implement the initiative in Spain, Mobipay España, S.A was created. Its shareholders are the country’s three cellular telephone operators (40%), 90 financial entities (48%) and the 3 financial payment media processors (the remaining 12%).

The challenge to MOBIPAY Spain was to develop a safe cellular phone payment system that would allow people to make quick and easy purchases, without needing to change banks, credit and debit cards or cell phones.

The Solution

How does MOBIPAY work?
In the MOBIPAY cell phone payment solution, three types of agents play a role:

· Merchants. MOBIPAY is a system that resembles other electronic payment methods and operates in a similar way. The infrastructure used is the same as that which exists for payments using credit and debit cards (PSTs), and merchants need only type in the customer’s telephone number, key in a “Mobipay alias” or read a bar code.

· Store customers. In this case, MOBIPAY is a different way of operating, because instead of signing a receipt or sending in the customer’s card number (purchases by Internet), customers must enter a PIN code into their cell phones to confirm the payment transaction.

· Financial entities. Last of all, for financial entities, MOBIPAY works in the same way as payment by card, by communicating with the store’s PSTs. The difference is that the MOBIPAY PIN code must be requested before charging the purchase amount using the payment system chosen by the purchaser.

Technical features of the MOBIPAY system

• Adapters.
  They encapsulate the variants inherent to each operator so as to adapt the different manufacturers’ units to the single MOBIPAY access node interface.
• Access Node.
  Developed by Fujitsu SPAIN, it is responsible for performing the logical part of each transaction associated with the Customer’s telephone communication. There is one access node at each operator: Telefónica Móviles, Vodafone and Amena.
• Router.
  It connects the communications between all of the access nodes and the financial entities which form part of the MOBIPAY system.

The solution offered by FUJITSU

FUJITSU’s contribution was a fundamental part of the MOBIPAY cell phone payment system’s operation, because the access node, coupled with the router, is one of the two key components in the MOBIPAY architecture.

FUJITSU’s offer was selected for this development over the proposals of other first-rate companies in the sector, “first of all, because its offer was very much in line with the foreseen costs; secondly, because of the guarantees it gave in terms of executing the project by the established deadline, and, thirdly, because of its experience, which was demonstrated during its participation in the development of the former Movilpago access node,” says the Technology Director of MOBIPAY, Carlos J. Vila.

FUJITSU has therefore carried out work revolving around two areas:
Development of the MOBIPAY Access Node: FUJITSU has connected the payment media of the financial entities with those of the end customer’s cell phones of different operators. The system developed manages the specific features of each operator and the different existing telephones, creating a unified interface for the users of this new payment system.

Training for the MOBIPAY personnel devoted to operation and maintenance of the system: FUJITSU has offered qualified support to the operations and maintenance departments of both MOBIPAY and the cellular phone operators, carrying out the transfer of technical responsibilities in a practically manner within the new system.

Features of the Access Node developed by FUJITSU
The access node is deployed at each of the cellular operators, and included among its features are those of discovering telephone capacities and deciding upon the most adequate method of communication at each given time.

It also determines whether the telephone belongs to a valid MOBIPAY customer and communicates with that customer in the selected language, interpreting his or her responses. Plus, it produces a record of the transaction and translates the protocol of communications used by the adapter to the protocol used by the router.

In order to communicate with the customer’s phone, the access node uses two technologies existing in GSM cell phone networks: the USSD system (unstructured supplementary service data) as the main mechanism for communication with MOBIPAY users, and the SMS (short messaging) system used on those occasions in which information is sent that must be stored in the phone and for those terminals which lack USSD.

Advantages in using USSD:

• Immediate dialogue, without intermediate storage, as is the case with SMS.
• Possibility of carrying out complex dialogues (more than one query and response) within the same USSD session.
• USSD chains are handled just like telephone numbers and may be stored in the telephone’s memory.
• It uses channels other than those used for voice, so calls can be received sat the same time.
• It require no complex terminal setup (like WAP does).
• It is faster. Typical interaction times: 4 seconds.

The Results

As a result of this project, MOBIPAY began to market the first cellular phone payment system in Valladolid with surprising results: more than 1,400 stores in this city have joined the MOBIPAY system.

This new possibility has occurred thanks to “a device able to transform cellular phone communication into a financial message, and vice versa, such that a transaction originating in the financial world can be sent to a cell phone in a form which is understandable to the phone,” as MOBIPAY’s Business Development Director, Javier Díaz, explains.

MOBIPAY has turned Spain into the worldwide leader in cell phone payment development, which stands out from the other cell phone payment development taking place in Europe, because of both its characteristics and its acceptance by the end customers.

This commitment by MOBIPAY has received not only the support of the business world, but also that of the public administration, through the assignment of economic aid by the Profit Program of the Ministry of Science and Technology. Likewise, the CBDe (Business Dialogue and Electric Commerce) has seen this solution as an international reference in payment by cellular telephone and has recommended that the governments of several countries promote solutions of cooperation between financial entities and mobile operators.

Benefits of the Solution

• The system developed is valid for any GSM operator and any financial entity.
• Use of USSD technology in an innovative manner.
• Security of the financial transactions ensured by the system.
• The end customer does not have to change cell phones or financial entities in order to use the MOBIPAY system: universal nature of system use.
• Ease in using the payment system for all of the parties involved.
• Speed in implementation of the technical solution.
• Sharing of technical knowledge with the MOBIPAY personnel in a rapid, effective manner.
• Technical support for the system provided from the first day of implementation.
• Total personalization of the technology to MOBIPAY needs.