Mastercard Debuts Quantum “Future-Proofed” Payments

Need to Know

• Mastercard’s new Enhanced Contactless (Ecos) specifications are meant to future-proof Mastercard’s contactless payment technology as quantum computing is introduced to the payments ecosystem.
• Ecos will help ensure that any device can become a contactless payment device while improving privacy and security features.
• Mastercard plans to roll out the new quantum technology over the coming years and promises a seamless transition.

Analysis

Mastercard has announced the release of newly-unveiled quantum-resistant standards that will the enhance privacy and security of contactless payments for both consumers and businesses.

The company’s new Enhanced Contactless (Ecos) specifications make Mastercard the first company to bring quantum-resistant technologies to contactless payments. According to Mastercard, with the implementation of Ecos, contactless payments will be “future-proofed,” allowing consumers to access the security and convenience of Ecos tech long into the future.

“Contactless is the present and future of in-person payments,” said Ajay Bhalla, president, cyber and intelligence at Mastercard. “2020 brought with it a rapid acceleration of digitization and reinforced the importance of digital solutions—like contactless—to help meet our everyday needs. As the ecosystem continues to evolve, more connected devices and the Internet of Things are going to create more user demand and an even greater need for constant innovation to build next-generation capability, helping to ensure that technology never outpaces trust.”

Using Ecos’s specifications, any device will be able to be used as a payment device, meaning it will be less necessary for customers to carry physical cards as backup payment methods. In addition, Ecos’s quantum-resistant technology will ensure contactless interactions happen quickly—under half a second—and bring with them enhanced privacy and security capabilities. Ecos is implemented through a software upgrade, meaning there is no need for new hardware or terminals for merchants.

In a press release announcing Ecos, Mastercard reported that, in the third quarter of 2020, contactless payments accounted for 41% of in-person purchase transactions, which is an increase of 30% year-over-year. Mastercard anticipates the contactless trend, which solidified due to the COVID-19 pandemic, will only continue.

Mastercard has had quantum computing on its roadmap for some time, mentioning a number of financial-industry use cases for quantum technology in its October 2020 Signals report. Among them is the ability for retailers to “realize meaningful improvements to the bottom line from better optimizing shipping and distribution operations” through quantum computing.

The credit card company has also been continuously innovating its contactless payment tech throughout the pandemic, as touch-free commerce has become a priority for both retailers and consumers. In October, the company introduced Shop Anywhere, a platform that combines Mastercard’s many payments-focused innovations into a straightforward approach to frictionless retail. The platform is a checkout-free (sometimes called cashierless) solution that is powered by AI and computer vision and allows customers to select products and pay for them without ever having to wait or scan a credit card. The company also recently launched Tap on Phone, which turns any smartphone into a POS system, and launched virtual mobile cards for its corporate clients.