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Vicky Nolan

SafeTPay Facilitates Secure ATM Transactions

14 June 2000

Is there any single product that will prove to be the best payment solution for Net betting sites? Among the many companies hoping that their solution will be the chosen one, SafeTPay has developed a system that allows consumers to purchase goods and services over the Internet using existing ATM-cards with PIN (personal identification number), as well as credit cards and smart cards. The company, which came together in late 1999, believes its unique product will solve a number of payment issues, including chargebacks, that are dogging the interactive betting industry.

"Various systems have been proposed for secure e-commerce," said Gerry Gay, SafeTPay's sales and marketing VP. "They use a variety of devices and methods to reassure consumers, but do little to simplify consumer choice and privacy and address the merchant's needs."

"Existing systems simply protect consumers by holding merchants responsible for losses. But with SafeTPay, everyone is protected. The consumer's data is heavily encrypted before leaving their PC, and the encrypted data goes to a bank processor without passing through the merchant's hands," he added. SafeTPay has applied for a US patent on the system.

The system requires some change on both the players' and the operators' parts. The SafeTPay PIN pad, which can read ATM cards, credit cards and smart cards, is hooked up to the consumer's computer and communicates with SafeTPay's proprietary payment software, which is housed on the merchant's computer. The customer decides how much money he wants to gamble, enters that amount into the computer and clicks the SafeTPay icon to activate the PIN pad for the payment transaction.

Clicking the icon initiates a process in which the merchant computer sends of a packet of information, including the merchant identification number and amount of payment to be sent, to the PIN pad. The consumer slides the card through the pad, and SafeTPay encrypts the information. The PIN number entered onto the pad is DES (Data Encryption Standard, a popular symmetric-key encryption required for PIN use)-encrypted. Finally, the browser wraps the transaction with SSL (secure socket layer) encryption before it's sent to the bank or payment processor. When the payment information arrives at the financial institution, SafeTPay unwraps the SSL encryption, along with its proprietary encryption surrounding the transaction information, while the financial institution unwraps the DES PIN block as required by banking regulators.

By sliding the card's magnetic strip on the PIN pad, more information is included in the transaction than is available by simply punching in the card's numbers. This benefits the gaming site by making the transaction appear as if it came from a physical location and not an Internet site, which presents it as a "card present" credit card transaction. Plus, by allowing players to pay with an ATM card, Net betting sites benefit by paying a lower transaction fee than for credit cards. Another advantage, Gay said, is that the site operators are no longer is responsible for handling the payment because the consumer is the one sending payment information to the payment processing service.

SafeTPay will provide the PIN pads to merchants who will then decide how consumers would receive them. Gay suggested that most sites would supply the PIN pads to customers either for free or at a low cost.

Gay says that SafeTPay is finalizing an agreement with MicroGaming Systems that would have MicroGaming taking the SafeTPay payment system to its licensees. Additionally, the company has just wrapped up a licensing agreement with SafeTPay Europe for representation in Europe. Another deal is in the works between SafeTPay and a multi-continent card processor that would allow customers around the world to use the SafeTPay payment system.

For a demonstration of the SafeTPay payment system, visit the company's website at

SafeTPay Facilitates Secure ATM Transactions is republished from
Vicky Nolan
Vicky Nolan