Bringing a point of sale terminal to market isn't as easy as it used to be. Since the introduction of contactless and mobile payment tech, the number of tests a manufacturer must pass for certification is "unbelievable," executives at U.K.-based Spire Payments say.
The latest version of Payment Card Industry security standards and various versions of Near Field Communication and contactless payment software have turned POS testing into a lengthy, complex process, says Kazem Aminaee, CEO of Spire Payments.
Spire had to undergo as many as 1,600 different tests for its latest line of mobile and portable terminals, Aminaee says.
"You have the latest versions of the contactless software, then you have six different sets of NFC phones and all of the different chip-based cards being issued that have to be tested" at different distances from the terminal, Aminaee says.
"It all brings on a higher level of security, so we certainly endorse it, but NFC and mobile bring on a lot of new challenges and what we are saying is that is getting more difficult," Aminaee says.
Spire has "achieved a lot" in the past year in going through the process of getting terminals certified for EMV, as well as the card brands' specific contactless technologies, Aminaee says.
The company expects to stay busy, considering payments technology isn't slowing down.
The onset of Host Card Emulation will add to the terminal testing. HCE technology allows virtually any application to make NFC payments, bypassing the need to access secure elements in a smartphone handset.
"HCE and cloud-based solutions will increase the testing," Aminaee says. "But it will also bring Visa, MasterCard and many banks into stronger NFC adoption, which will make the specification process extremely complex."
Being able to get through the testing process quickly is a significant advantage for terminal manufacturers, he says. A testing process can take several months, and it can get costly when an entire line of NFC phones has to first be certified and then found to be compatible with a POS terminal.
"The average estimate for certifying a phone set for NFC is estimated at a half million pounds ($840,000 U.S.)," Aminaee says.
Two years ago, even though merchants were not seeing many NFC or contactless payments, they still wanted terminals compatible with those technologies, Aminaee says.
Now, most acquirers in Europe are focusing on mobile point of sale options, Aminaee says. Spire has moved into mobile technology, most recently supplying the mobile chip-and-PIN devices for Credit Agricole in France late in 2013.
Spire is involved in about 30 mobile POS projects throughout Europe, Aminaee adds. "We will continue that process, even with larger merchants who are looking to add iPad at the checkout lines as well mPOS with chip-and-PIN."
The company hopes to continue its growth in Eastern Europe, despite the political showdown between the U.S. and Russia that may spark Russia to move to a national payment system.
"The sanctions against Russia have no effect on us at this time," says Alain Fernando-Santana, chief administration officer for Spire. "If we were like an IBM in the world, it would affect us, but we just have our niche in the payments space."
As such, Spire Payments Eastern Europe should continue to serve the region, even if Russia does establish a national payment scheme, Fernando-Santana says.
Spire purchased Altius Plus in early April, rebranding the Romanian payments company as Spire Payments Eastern Europe LCC. Spire views the acquisition as a way to boost product development in the region.
Spire is watching the U.S. payments market, but is more focused on strengthening its European, Asian and Latin America businesses.
"We are not feeling 100% that we have to be in the U.S., but we are open to opportunities and possible acquisitions," Aminaee says.
Because of the U.S. migration to EMV-chip cards, it is a good time to seek opportunities in the country, Aminaee adds. "There is a lot of terminal churn when migrating to EMV, and a lot of companies in the U.S. are seeking European companies that have expertise in EMV."