German girocard mobile payments pilot gets thumbs up

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In December 2017, the Cooperative Financial Network Volksbanken Raiffeisenbanken in Germany started a “Friends&Family” pilot project for girocard mobile payment via smartphones, using a digitized credit card or girocard (girocard being the most widely used payment card in Germany).

This new mobile payment solution has been very well accepted, not only by the 200 employees of the two pilot banks (Volksbank Mittelhessen and VR-Bank HessenLand) but also by retailers.

A secure and user-friendly solution

DG VERLAG worked closely with G+D Mobile Security to provide digitized payment cards with the highest level of security and protection to the German cooperative banks. The solution is based on Host Card Emulation (HCE) technology which is state-of-the-art for mobile payment and will allow the bank to integrate future requirements.

Part of the bank customer’s payment card data will remain inside the secure digital HCE card production system, while another part of these data is transferred to the customer’s smartphone.

As soon as the bank customer orders the digitized version of his or her payment card and activates it via the VR-Banking App on the phone, the smartphone can be used for payment transactions by holding it close to a Point-of-Sale payment terminal in a shop.

The mobile payment solution supports both Visa and Mastercard payment schemes as well as the Cooperative Financial Network’s background systems. It has been approved by the credit card organizations as being compliant to their high security and quality standards.

“We are pleased to offer a user-friendly and secure new way of payment to the customers of Volksbanken and Raiffeisenbanken. Together, we have been working on several other successful solutions in the context of our digital strategy, which has been a very valuable experience,” says DG VERLAG Member of the Board, Franz-J. Köllner.

Commercial launch

The commercial launch of the new mobile payment service is scheduled for the summer of 2018, making it available to customers of about 85% of Volksbanken and Raiffeisenbanken. Other launch partners for the digital credit card and girocard, in addition to DG VERLAG, G+D Mobile Security and the bank branches of the pilot phase, include the National Association of German Cooperative Banks (BVR), DZ BANK, Fiducia & GAD IT and CardProcess.