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EPIC TECHNOLOGY GROUP

Report on ISO8583,EDCPOS vs mPOS and EMV vs Magnetic Strip Cards

Assignment

Darshana Senavirathna

8/31/2015

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Contents ISO8583 ......................................................................................................................................................... 2

ISO 8583 Message Structure ......................................................................................................................... 3

1. Message Type Indicator (MTI) .......................................................................................................... 3

Digit 1 .................................................................................................................................................... 4

Digit 2 .................................................................................................................................................... 4

Digit 3 .................................................................................................................................................... 5

Digit 4 .................................................................................................................................................... 6

2. Bitmaps ............................................................................................................................................. 7

3. Data elements ................................................................................................................................... 8

References .................................................................................................................................................. 16

Magnetic Stripe Card vs EMV Chip Cards ........................................................................................... 17

Magstripe Cards for Financial Purposes ................................................................................................. 17

The flow of a Magstripe transaction ....................................................................................................... 20

2. EMV chip cards .................................................................................................................................... 20

3. Comparison between Magnetic Stripe Card and EMV chip card ........................................................ 23

4. Conclusion ........................................................................................................................................... 25

5. References .......................................................................................................................................... 25

EDCPOS vs mPOS Devices ......................................................................................................................... 26

Electronic Data Capture (EDC) .................................................................................................................... 26

Mobile Point of Sales (mPOS) ..................................................................................................................... 27

Comparison of EDCPOS and mPOS ............................................................................................................. 28

Security ............................................................................................................................................... 28

Price .................................................................................................................................................... 28

Convenience ........................................................................................................................................ 28

Connectivity ........................................................................................................................................ 29

Other Aspects ...................................................................................................................................... 29

Conclusion ........................................................................................................................................... 29

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ISO 8583

Introduction

In the modern world the electronic payment sector plays a huge role in financial transactions. The

electronic card payment sector has become very popular for last three decades.

Normally an electronic card payment happens from a transaction acquiring device such as POS (Point-of-

Sales) or an ATM (Automated Teller Machine) which subsequently having various authorization and

verification process along with the checking of the status of the user financial information through

relevant financial institutions. This process is complex and involves message exchanges between

different organizations.

ISO 8583 defines a common global standard format for the financial transaction card originated

messages which may interchange between acquirers and card issuers.

ISO 8583 Consists of 3 Parts

ISO 8583-1:2003

(Revision for 8583: 1993)

• Specifies message structure, format and content, data elements and values for data elements

ISO 8583-2:1998

• Application and registration procedures for Institution Identification Codes

ISO 8583-3:2003

• Maintenance procedures for messages, data elements and code values

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ISO 8583 Message Structure

This consists of 3 parts

The Message Structure of ISO 8583 message

1. Message Type Indicator (MTI)

Message Type Indicator (MTI) is a 4 digit numeric field which determines the high level function of the

message. Each digit represents information which describes the characters of the message according to

ISO 8583.

Example 1.1

1.Message type indicator (MTI)

2.One or more bitmaps, indicating which data elements are present

3.Data elements, the fields of the message

2 1 1 0

Digit 1 Digit 2 Digit 3 Digit 4

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Digit 1

Digit 1 describes the ‘version of ISO 8583’ which is being used for the message transmission. From the

example 1.1 it says the message belongs to ISO 8583-3:2003 version.

Numerical

Value

Meaning

0 ISO 8583-1:1987 version

1 ISO 8583-2:1993 version

2 ISO 8583-3:2003 version

3,4,5,6,7 Reserved for ISO use

8 Reserved for National use

9 Reserved for Private use

Digit 2

Digit 2 explains ‘Class of the message’. From the example 1.1 the message implies it is an “Authorization

Message” Since the Digit 2’s value is ‘1’.

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Numerical

Value

Meaning

0,9 Reserved by ISO

1 Authorization Message

2 Financial Message

3 File Action Message

4 Reversal and Chargeback Message

5 Reconciliation Message

6 Administrative Message

7 Free Collection Message

8 Network Management Message

Digit 3

Third Digit specifies the message function which defines how the message should flow within the

system.

For instance there can be functions such as ‘Requests’ which are intended for end-to-end

communication. This could be a message which sends from acquirer to issuer and back with timeouts

and automatic reversals in place.

One other type of message is that point-to-point message where it may travel from one point to

another. For example this could be a message which sends from terminal to acquirer, from acquirer to

network, from network to issuer etc. with a transmission guarantee over each link.

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Position Meaning

0 Request

1 Request Response

2 Advice

3 Advice Response

4 Notification

5 Notification Acknowledgement

6 Instruction (ISO 8583:2003 only)

7 Instruction Acknowledgement (ISO 8583:2003 only)

8,9 Reserved for ISO use.

According to the example 1.1 the digit three value of 1, it implies the message is a Request Response

message according to ISO 8583 standard.

Digit 4

This digit defines the location of the message source within the payment chain. This is also called

‘Message Origin’

Position Meaning

0 Acquirer

1 Acquirer Repeat

2 Issuer

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3 Issuer Repeat

4 Other

5 Other Repeat

6,7,8,9 Not Defined / Not Available

According to the example 1.1 the message source is Acquirer.

2. Bitmaps

Bitmap is a field which indicates the other data of a message. This is either a field or subfield of data.

Each and every message contains at least one Bitmap which is called the ‘Primary Bitmap’

Bitmap is generally transmitted as 16 hexadecimal characters or 8 bytes binary data. A bitmap indicates

which fields are included in the message. Furthermore if the most significant bit is 1 (present) it

indicates ‘Secondary Bitmap’ is available.

For example let’s take the following Hexadecimal Message:

C150001100AD4804 Example 2.1

The following is the converted binary message from the hex decimal message.

1100,0001,0101,0000,0000,0000,0001,0001,0000,0000,1010,1101,0100,1000,0000,0100

As indicated by the above translation, the first 4 digits indicate as 1100 where the very first (Most

Significant Bit) shows the value as 1 (present) where it indicates there is a ‘Secondary Bitmap’ Present in

the message.

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According to the above message the following fields are present in the message.

2, 8 ,10 ,12 ,28 ,32 ,41 ,43 ,45 ,46 ,48 ,50 ,53 ,62

3. Data elements

Data Elements are the individual fiends which carrying transaction information. From the initial 1987 ISO

8583 introduction, it specified 128 data elements which increased up to 192 data elements in later

revisions. Notably in 1993 revision some new definitions were added while some were deleted.

Each data element is described in standard format which defines the permitted content of field and the

field length.

Abbreviation Meaning

a Alpha, including blanks

n Numeric values only

s Special characters only

an Alphanumeric

as Alpha & special characters only

ns Numeric and special characters only

ans Alphabetic, numeric and special characters.

b Binary data

z Tracks 2 and 3 code set as defined in ISO/IEC 7813 and ISO/IEC 4909 respectively

. or .. or ... variable field length indicator, each . Indicating a digit.

x or xx or xxx fixed length of field or maximum length in the case of variable length fields.

Furthermore the field length is also determined as follows

Type Meaning

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Fixed no field length used

LLVAR or (..xx) Where LL < 100, means two leading digits LL specify the field length of field

VAR

LLLVAR or (...xxx) Where LLL < 1000, means three leading digits LLL specify the field length of

field VAR

LL and LLL are hex or ASCII. A

VAR field can be compressed

or ASCII depending of the

data element type.

LL can be 1 or 2 bytes. For example, if compressed as one hex byte, '27x

means there are 27 VAR bytes to follow. If ASCII, the two bytes '32x, '37x

mean there are 27 bytes to follow. 3 digit field length LLL uses 2 bytes with a

leading '0' nibble if compressed, or 3 bytes if ASCII. The format of a VAR data

element depends on the data element type. If numeric it will be compressed,

e.g. 87456 will be represented by 3 hex bytes '087456x. If ASCII then one byte

for each digit or character is used, e.g. '38x, '37x, '34x, '35x, '36x.

ISO-defined data elements

Data Field

Type Usage

1 b 64 Bit map (b 128 if secondary is present and b 192 if tertiary is present)

2 n ..19 Primary account number (PAN)

3 n 6 Processing code

4 n 12 Amount, transaction

5 n 12 Amount, settlement

6 n 12 Amount, cardholder billing

7 n 10 Transmission date & time

8 n 8 Amount, cardholder billing fee

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9 n 8 Conversion rate, settlement

10 n 8 Conversion rate, cardholder billing

11 n 6 System trace audit number

12 n 6 Time, local transaction (hhmmss)

13 n 4 Date, local transaction (MMDD)

14 n 4 Date, expiration

15 n 4 Date, settlement

16 n 4 Date, conversion

17 n 4 Date, capture

18 n 4 Merchant type

19 n 3 Acquiring institution country code

20 n 3 PAN extended, country code

21 n 3 Forwarding institution. country code

22 n 3 Point of service entry mode

23 n 3 Application PAN sequence number

24 n 3 Function code (ISO 8583:1993)/Network International identifier (NII)

25 n 2 Point of service condition code

26 n 2 Point of service capture code

27 n 1 Authorizing identification response length

28 x+n 8 Amount, transaction fee

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29 x+n 8 Amount, settlement fee

30 x+n 8 Amount, transaction processing fee

31 x+n 8 Amount, settlement processing fee

32 n ..11 Acquiring institution identification code

33 n ..11 Forwarding institution identification code

34 ns ..28 Primary account number, extended

35 z ..37 Track 2 data

36 n ...104 Track 3 data

37 an 12 Retrieval reference number

38 an 6 Authorization identification response

39 an 2 Response code

40 an 3 Service restriction code

41 ans 8 Card acceptor terminal identification

42 ans 15 Card acceptor identification code

43 ans 40 Card acceptor name/location (1-23 address 24-36 city 37-38 state 39-40 country)

44 an ..25 Additional response data

45 an ..76 Track 1 data

46 an ...999 Additional data - ISO

47 an ...999 Additional data - national

48 an ...999 Additional data - private

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49 a or n 3 Currency code, transaction

50 a or n 3 Currency code, settlement

51 a or n 3 Currency code, cardholder billing

52 b 64 Personal identification number data

53 n 16 Security related control information

54 an ...120 Additional amounts

55 ans ...999

Reserved ISO

56 ans ...999

Reserved ISO

57 ans ...999

Reserved national

58 ans ...999

Reserved national

59 ans ...999

Reserved national

60 ans ...999

Reserved national

61 ans ...999

Reserved private

62 ans ...999

Reserved private

63 ans ...999

Reserved private

64 b 16 Message authentication code (MAC)

65 b 1 Bitmap, extended

66 n 1 Settlement code

67 n 2 Extended payment code

68 n 3 Receiving institution country code

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69 n 3 Settlement institution country code

70 n 3 Network management information code

71 n 4 Message number

72 n 4 Message number, last

73 n 6 Date, action (YYMMDD)

74 n 10 Credits, number

75 n 10 Credits, reversal number

76 n 10 Debits, number

77 n 10 Debits, reversal number

78 n 10 Transfer number

79 n 10 Transfer, reversal number

80 n 10 Inquiries number

81 n 10 Authorizations, number

82 n 12 Credits, processing fee amount

83 n 12 Credits, transaction fee amount

84 n 12 Debits, processing fee amount

85 n 12 Debits, transaction fee amount

86 n 16 Credits, amount

87 n 16 Credits, reversal amount

88 n 16 Debits, amount

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89 n 16 Debits, reversal amount

90 n 42 Original data elements

91 an 1 File update code

92 an 2 File security code

93 an 5 Response indicator

94 an 7 Service indicator

95 an 42 Replacement amounts

96 b 64 Message security code

97 x+n 16 Amount, net settlement

98 ans 25 Payee

99 n ..11 Settlement institution identification code

100 n ..11 Receiving institution identification code

101 ans ..17 File name

102 ans ..28 Account identification 1

103 ans ..28 Account identification 2

104 ans ...100

Transaction description

105 ans ...999

Reserved for ISO use

106 ans ...999

Reserved for ISO use

107 ans ...999

Reserved for ISO use

108 ans ...999

Reserved for ISO use

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109 ans ...999

Reserved for ISO use

110 ans ...999

Reserved for ISO use

111 ans ...999

Reserved for ISO use

112 ans ...999

Reserved for national use

113 ans ...999

Reserved for national use

114 ans ...999

Reserved for national use

115 ans ...999

Reserved for national use

116 ans ...999

Reserved for national use

117 ans ...999

Reserved for national use

118 ans ...999

Reserved for national use

119 ans ...999

Reserved for national use

120 ans ...999

Reserved for private use

121 ans ...999

Reserved for private use

122 ans ...999

Reserved for private use

123 ans ...999

Reserved for private use

124 ans ...999

Reserved for private use

125 ans ...999

Reserved for private use

126 ans ...999

Reserved for private use

127 ans ...999

Reserved for private use

128 b 64 Message authentication code

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References

http://www.codeproject.com/Articles/100084/Introduction-to-ISO

https://www-

01.ibm.com/support/knowledgecenter/SSMKHH_10.0.0/com.ibm.etools.mft.samples.iso8583.doc/do

c/background.htm

http://www.chileoffshore.com/en/toolkits/iso8583-tools/show-bitmap

https://en.wikipedia.org/wiki/ISO_8583

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Magnetic Stripe Card vs EMV Chip Card

1. Magnetic Stripe Card

Magnetic storage technology was developed during the period of World War II which was used for the

computer related information storing after the world war. In 1960’s IBM developed a method to store

data using a similar technology with plastic cards which now called as Magnetic Stripe Card.

Magnetic Stripe Card is also called ‘Magstripe’ or ‘Swipe Card’ which is made from a plastic card which

has a stripe of iron oxide to store information. Magstripe cards are being used as Identification Cards,

Credit and Debit Cards, Access Control Cards, Transportation Cards etc.

Magstripe Cards for Financial Purposes

Magstripe Cards have been widely used as electronic payment cards (Debit/Credit cards) since the

inception of electronic card payment. In Magstripe card certain information has been recorded in the

Magnetic Strip. This magnetic stripe has been divided in to three tracks.

Front Side of A Magstripe Card Backside of a Magstripe Card

Track 1

Track one is 210 bits per inch (bpi), and holds 79 six-bit plus parity bit read-only characters.

Track one contains specific bank information such as

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Account Number

Card Holder’s name

Expiration Data

Certain Security Codes

The information on track one is contained in two formats -- A, which is reserved for proprietary use of

the card issuer, and B, which includes the following:

1. Start sentinel -- 1 character

2. Format code="B" -- 1 character (alpha only)

3. Primary account number -- up to 19 characters

4. Separator -- 1 character

5. Name -- 2-26 characters

6. Separator -- 1 character

7. Expiration date or separator -- 4 characters or 1 character

8. Service Code

9. Discretionary data -- enough characters to fill out maximum record length (79 characters total)

10. End sentinel -- 1 character

11. Longitudinal Redundancy Check (LRC), a form of computed check character – 1 character

1 2 3 4 5 6 7 8 9 10 11

% B 1234567890123445 ^ DARSHANA/S. ^ 1701 1200000 0000000000000**XXX****** ? *

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Track 2

Track two contains 75 bits per inch density, and holds 40 four-bit plus parity bit characters.

Generally track 2 contains information such as

Card Number

Expiration Date

Encrypted PIN.

This track format is as follows.

1. Start sentinel -- 1 character

2. Card Number

3. Separator -- 1 character

4. Expiration date or separator -- 4 characters or 1 character

5. Service Code

6. Encrypted PIN

7. End sentinel -- 1 character

8. LRC -- 1 character

1 2 3 4 5 6 7 8

; 1234567890123445 = 1701 1200 XXXX00000000 ? *

Track 3

Track three is having a density of 210 bits per inch, and holds 107 four-bit plus parity bit characters.

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Generally not used worldwide. Sometimes even physically not present in cards from certain

manufacturers.

The flow of a Magstripe transaction

1. When the card is swiped through the device, data from the magnetic stripe is captured and included in the transaction request. Ideally the

2. The request, with the captured data, goes from the device to the acquirer. 3. The request then goes to the issuer. 4. The issuer uses the data from the card, as well as information such as the transaction amount, to

make an authorization decision. 5. The response is then sent back to the acquirer. 6. The response then goes to the device.

2. EMV chip cards

EMV was initially developed by EuropePay, VISA and MasterCard organizations on 1993 with having the

objective of improving the security of an electronic transaction. EMV is a smart card which is also called

as ‘Chip Cards’ or ‘IC Card’. EMV stores data on a ‘chip’ instead of a ‘magnetic stripe’ which enables to

store a higher amount of data on the card.

Even though EMV uses ‘Chip’ to store data, still the magnetic stripe is available in most of the EMV cards

to enable backward compatibility.

Types of EMV

There are different types of EMV cards in terms of the contact. One type should be inserted physically to

the acquiring machine while the other type is contact less card which can be read over a short distance

through RFID (Radio Frequency Identification) technology.

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Types of Authorization

There are two types of authorization of EMV card. One is ‘Chip-and-Pin’ and the other is ‘Chip-and-

Signature’. This is used according to the requirement of Issuer.

From Chip-and-Pin it requires to add the PIN number at the point of sales. From Chip-and-Signature

method, customer signature is sufficient for the authorization of the transaction.

EMVCo

As mentioned above , EMV initialized by Europay , Mastercard and VISA has now expanded and now

working under an organization called ‘EMVCo’ which controlled split equally by VISA, MasterCard , JCB

,American Express ,China Union and Discover.

EMV Chip Card

RFID Card

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The flow of EMV transaction.

1. The card is inserted to the terminal’s chip card reader. Terminal reads the chip card and initially determines whether it is a financial card and proceeds. If the card is a financial card it starts acquiring data from card. Then the chip card creates a request cryptogram. The cryptogram is a collection of several pieces of data related to the card and the transaction that is encrypted under a special key stored in the card.

2. This request cryptogram, along with other EMV-related information from the card and the terminal, is sent to the acquirer.

3. Then, the request cryptogram is sent to the relevant issuer by acquirer.

4. The issuer verifies the request cryptogram and optionally generates a response cryptogram.

By verifying the cryptogram, the issuer is assured that the transaction came from the chip card (and was not fraudulently introduced into the transaction request path). If the request cryptogram is verified successfully, the issuer may optionally generate a response cryptogram. (The issuer can also send a command back to the chip card as part of the transaction response that will update some specific fields within the chip.)

5. The response cryptogram is passed in the response that goes back to the acquirer.

6. Then, the response cryptogram is passed in the response to the device.

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7. At this point, the device has to once again communicate with the chip card, because the card will try to verify the response cryptogram. By doing so, the chip card can be assured that the response came from the issuer, and was not fraudulently introduced into the transaction response path.

3. Comparison between Magnetic Stripe Card and EMV chip card

1. Security

Duplication:

The information which is stored inside Magstripe card can be copied and duplicated easily. The

main reason for this is the information which has been stored is straight forward with using very

minimal encryptions (only PIN code is encrypted and stored on the Magstripe).

Since EMV card uses encryption methods such as Triple DES with independent keys it is

technically impossible to forge a fake card. This is very helpful to secure financials by a time of a

loss of the card or information of the card has been exposed to vulnerable parties (ex. Via

Internet Transaction).

Authentication

Generally in Magstripe card it doesn’t require for the user to insert the PIN instead a placement

of signature is sufficient in Point-of-Sales. (However for ATM transactions it is required to insert

the PIN) This is a disadvantage of Magstripe if the card is stolen.

In EMV cards it uses a PIN verification system in Chip-to-PIN method. From this method the

financials will be protected in even the card is stolen.

Card-Swipe vs. Card-in-device

In general Magstripe transaction once the card is swiped and acquired information by the

device, further interaction will not happen between card and the device during the time of the

transaction.

In EMV method, the card has to be inside the device for the time of the transaction where it

sends information and waits until it receives information from the issuer to validate about the

transaction. This prevents in-line security issues.

2. Data Storing

Size of Storage

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In Magstripe the information which can be used in device is very limited. It only includes the

most important information about card, card holder and issuer. This is a limitation when it

comes to the security feature expansion.

Furthermore once the information has been recorded on the card, further changes doesn’t

happen where the information existing is not getting updated.

In EMV since it uses an electronic chip, the data storage space is significantly higher than

Magstripe where it also allows EMV to use security features such as data encryption.

Multiple Usage of the Card

In Magstripe the since the storage size limitations the card can be used for a single purpose (ex:

- As Debit Card and Credit Card you have to use two different cards even from the same issuer)

In EMV since the storage size is high multiple card information can be stored in the same card.

For example you can use the same card for your debit and credit transactions. The future aspect

of this is integration of all the cards such as driving license cards, national security card,

insurance card, identification card, credit cards & debit cards (even from different issuers) to a

one single card where it is continent for the user and environmental friendly in large scale.

3. Durability

Magstripe cards are very sensitive for the magnetic fields which might cause a loss of the

information of the card. Furthermore the scratching or folding might make the card damaged

and unusable.

Since EMV uses an electronic chip, magnetic fields cannot interfere with the data. Furthermore

EMV card can tolerate scratching and folding for some extend since it’s memory is centralized

into few millimeters of the card.

4. Cost

The cost of Magstripe Card is comparatively low which remains between $0.35 to $0.75.

The cost of EMV is comparatively higher which is between $0.97 to $1.38.

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4. Conclusion

Magstripe is a cheaper and easy to use solution for the financial institutions. However Magstripe

became unsecure by the time and since it has a very limited storage the further expansions and

developments are technically not possible. Furthermore Magstripe is easily getting damaged due to

various reasons.

Because of the above reasons Magstripe is a decline methodology which will be totally replaced from

EMV during next few years’ time.

EMV is a timely a much secured method which can be used for further expansions as well because of its

high storage. Furthermore Magstripe has the ability for the integration of multiple cards to one single

card which will be the future of electronic cards along with RFID facility where swipe is not necessary for

the transactions. EMV doesn’t get interfered because of magnetic stripes and can tolerate folding and

scratches for some extend which improves the durability of the card. Simply is enabling more options for

the future improvement while providing valid solutions for the existing problems in Magstripe cards

which can be considered as the future of the electronic card industry.

5. References

1. https://en.wikipedia.org/wiki/Magnetic_stripe_card

2. https://en.wikipedia.org/wiki/EMV

3. http://www.parappsys.com/news/industry-insights/chip-cards-what-and-why-of-emv.html

4. http://quickbooks.intuit.com/r/emv-migration/how-do-emv-transactions-differ-from-magnetic-

stripe-transactions

5. http://www.parappsys.com/news/industry-insights/comparing-chip-card-and-magnetic-stripe-

card-transaction-flows.html

6. http://blog.toasttab.com/emv-chip-card-magnetic-stripe-card-security

7. http://www.cardlogix.com/docs/pis/CardLogix_PIS_SmartCardsVsMagStripe.pdf

8. http://www.emv-connection.com/emv-faq/#q5

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EDC POS devices vs mPOS devices

Point of Sales (POS)

The point of sale (POS) is the time and place where a retail transaction is completed. It is the point at

which a customer makes a payment to the merchant in exchange for goods or after provision of a

service.

Electronic Data Capture (EDC)

EDC which stands for Electronic Data Capture which allows you to capture and authorize a credit card

transaction, effectively giving business the ability to accept credit and debit cards and complete the

transactions. EDC POS devices are the hardware components which can capture relevant financial data.

In a typical EDC there are three main components.

I. A Graphical User Interface.

The graphical user interface gives easy-to-use access for the users who are having different levels of

education which gives large icons and fonts. Furthermore some modern graphical user interfaces of

EDC POS devices contain advertisements and offers.

II. A Validation component

Objective of this component is to identify, verify and validate the user information and financial

information. Various methods of capturing information from cards are being used in modern devices

such as through Magnetic Strip Scanner, EMV (Europe Pay-Master-Visa) scanners and from finger

print scanners.

III. A reporting tool for analysis of the collected data

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This is a tool where you can analysis the financial information which had occurred via the devices.

EDC POS devices

Mobile Point of Sales (mPOS)

Mobile Point of sale (mPOS) is a device to perform the functions of POS device from a smartphone,

tablet or some other wireless device. mPOS allows providing financial service in place by improving the

customer experience. mPOS is a cost effective method since it capable to install and use in any smart

device and also this allow small business owners to do electronic transactions without investing in

electronic register. There are different payment methods for mPOS, such as magnetic stripe, EMV chip-

enabled cards, or contactless cards

Any smartphone or tablet can be transform into a mPOS by installing the relevant software that provide

by the vendor and the card reader needs to plug into the mobile device’s audio jack. Customer data is

not store in the device, it encrypted and stored in the cloud to protect the cardholder

information. Customer will receive a digital receipt after the transaction.

Types of mPOS devices:

mPOS Dongles & Attachments - These are mobile peripherals that are connected physically via a port to a mobile device (smartphone or tablet), in order to process payments.

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External mPOS Devices - These are Mobile Point of Sale devices that connect wirelessly, via Bluetooth or Wi-Fi, to a mobile device, in order to process payments.

Comparison of EDCPOS and mPOS

Security

EDC POS is a dedicated device which is solely built for the use of Electronic Payment. Since

EDCPOS is a purpose built device which is focused on electronic financial transaction, the

security is very high.

Since mPOS is used in a Smart Device, it has to run on the top of existing operating systems and

along with the existing applications. The existing applications and the operating system may

include security loopholes vulnerable programs where can be used for a security breach or

attack by the hackers. Furthermore the mobile device is designed for general purpose and not

specially designed for electronic financial undertake with required security measures.

Price

The Price of a EDCPOS device hardware stands between $200-$1000 USD .This cost excludes

the cost of installation, maintenance and the software cost. The total cost of an EDC POS system

is significantly high.

From the other hand mPOS device is cheap (starting from $50), which can be used with the help

of an existing smart device where the software / application cost is comparatively low (which

probably an application which can be downloaded from Merchant’s bank for free or a small

amount) where the maintain cost is negligible.

Convenience

Both of the devices (EDC POS & mPOS adapter) should be charged by time to time which has a

significantly high time of battery life where both are convenient for use. However in mPOS

device the mobile smart devices also should be charged frequently which is not convenient for

day-to-day use.

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Since mPOS is running on a smart device operating system as an application, the crash rate may

be higher than EDCPOS. Since EDCPOS is a purpose built device the hardware and software

constrains have built in a way to avoid crashes because of its architecture.

The usability EDC POS device is better comparatively mPOS where in EDCPOS has relevant

specific buttons (press buttons/touch buttons) where end user can easily recognize and use. In

mPOS it has a touch mobile screen where the touch may not be convenient for frequent use. (It

should be noted in mobile screen the screen display dimming time to time may also not be

convenient where if it is turned on all the time it may cause increasing the rate of battery

discharging.)

mPOS devices are connected to the mobile smart device using audio adaptor or via Bluetooth.

These connections might reduce the lifetime of the mobile device and /or respective

connectivity adaptor /device of mobile device.

Connectivity

Generally most of the EDCPOS and mPOS devices are using GPRS internet connectivity where in

some cases EDCPOS uses dedicated ADSL lines. However unlike EDCPOS in mPOS the internet

connectivity is shared with other applications of the devices where it may slower down the

functionalities of mPOS application.

Other Aspects

In EDCPOS it is possible for the merchant to print a receipt /invoice for the transaction and take

the customer signature where it can be used as a physical proof for the transaction for the

future purposes. But in mPOS printing receipts is not possible since the unavailability of the

printer instead it has the option of signing digitally on the screen which may be not convenient

for the customer. Furthermore in mPOS transaction customer doesn’t get a physical proof

(receipt) for the electronic transaction occurred.

Conclusion

EDCPOS is a purpose built device which is the most secured and most convenient device electronic

financial transaction. However the device hardware cost and other related costs are significantly high.

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mPOS whole system is not purpose built which affects the convince and security where the cost of

mPOS hardware and related costs are comparatively lower than EDCPOS.

EDCPOS is ideal for the environments where the electronic cards are frequently used such as super

market chains, vehicle gas stations, food franchises etc. where it is also affordable for the organizations

to maintain such system and devices.

mPOS is suitable for the environment where the electronic payment is not frequently used or much

popular and also the user / organization cannot afford a costly system such as EDCPOS. This system is

ideal for the startups , small scale convenient stores, and rural shops etc.

Reference

1. https://en.wikipedia.org/wiki/Point_of_sale

2. https://en.wikipedia.org/wiki/Electronic_data_capture

3. http://www.mastercard.com/corporate/mpos.html

4. http://www.alibaba.com/showroom/pos-terminal-price.html

5. http://www.entrepreneur.com/encyclopedia/point-of-sale-pos-system

6. http://techcrunch.com/2013/09/25/mpos-price-war/