The Web Payments Interest Group is close to reaching agreement on charter text for a Working Group that will develop W3C’s first Web payments standards. The current plan is for the Membership to review a draft charter in August, for W3C to launch the Working Group in September, and for participants to first meet face-to-face in October during W3C’s TPAC 2015 meetings in Sapporo, Japan.
A primary role of the Web Payments Interest Group is to gather industry use cases and requirements, analyze what standards (existing or not) would contribute to satisfying those use cases, and where necessary, spawn Working Groups to develop those standards. To that end, the group published a draft set of use cases in April. Since then, the group has identified a set of technical capabilities needed to fulfill those use cases, and discussed charters for groups to develop specifications for those capabilities.
Last week approximately 40 people from the Interest Group met in New York, hosted by Bloomberg, to review and prioritize the use cases and determine the level of consensus to standardize the following capabilities: payment scheme integration into the browser, strong authentication, strong identity and credentials, and settlement. It was tremendously useful to have developers in the room from browser vendors, merchants, telcos, banks, and payment service providers to walk through payment flows and prospective APIs and data formats.
After 2.5 days, we reached the following conclusions:
- There was consensus for a new Payment Architecture Working Group that would facilitate integration of current and emerging payment schemes into the browser. The initial scope will be limited to what is necessary for a “minimum viable payment.” A draft charter is still in discussion but the group reached consensus on a set of use cases that the charter should address.
- The Interest Group also discussed plans for two authentication-related Working Groups whose charters are in development within the W3C Team. One will focus on secure authentication of entities (users, systems and devices) to enable high-security Web applications; this group would be launched in collaboration with the FIDO Alliance. The second will work on a set of Hardware-Based Web Security standard services providing Web Applications usage of secure services enabled by hardware modules (TEE, secure elements, and other secure enablers). The Interest Group will provide input to those groups based on payments requirements.
- The Interest Group did not reach consensus to launch a Working Group on Identity and Credentials (see credentials agenda plan). We expect to continue to reach out to (international) stakeholders in the financial services, education, and healthcare industries to bring more use cases to the table.
- The Interest Group discussed a proposal from Ripple Labs to create a Settlement Community Group to explore how to use the Web as a means to bridge disparate payment networks and move toward a distributed settlement paradigm.
A meeting summary provides more detail and includes links to the full meeting minutes (to be made public on 29 June).
Industry Feedback at Roundtable
Given our proximity to Wall Street, we decided to organize an industry Roundtable as the last session of the face-to-face meeting. We solicited feedback on the Interest Group’s plan and discussed priorities and direction with numerous financial services organizations (some in the Interest Group, some not):
- American Express
- Apple
- Barclays
- Bill & Melinda Gates Foundation
- Bloomberg
- BPCE
- Camara Interbancaria de Pagamentos (CIP)
- Canton Consulting
- Capital One
- Citi
- City of New York
- Deutsche Bank
- Deutsche Telekom
- Digital-Bazaar
- Dwolla
- Electronic Transactions Association
- French Treasury Office
- Gemalto
- GS1
- GSMA
- HSBC
- Knowbility
- MasterCard
- Monegraph
- Mozilla
- NACHA
- NACS
- NIC.br
- Oracle
- PayGate
- R3CEV
- Rabobank
- Ripple Labs
- Target
- Santander
- SWIFT
- US Federal Reserve
- Visa
- Wells Fargo
- Worldpay
Among the topics discussed:
- The Interest Group’s strategy is to focus initially on a simple payment scenario. This will be the basis for future work on the broader topic of ecommerce (e.g., loyalty programs and coupons).
- Roundtable participants emphasized the need for solutions to manage identity, authentication, and authorization. They cited a spectrum of identity needs for different types of transactions, including anonymous (for cash-like transactions) to strong identity necessary to satisfy know-your-customer and anti money laundering regulation. It was pointed out that improved standard authentication techniques may ultimately lower regulatory cost.
- Participants recognized consumer protection and online privacy as important requirements. It was pointed out that some authentication approaches can improve privacy if the minimum information necessary for a transaction is shared only with the necessary parties.
- We discussed several use cases that may be added to the Interest Group’s list, including the Brazilian Boleto (and analogous instruments elsewhere in Asia and Europe), payments to multiple parties, subscriptions, and smart contracts.
- There was some discussion about the value of Web payments standards to foster innovation (and thus lower costs for consumers and merchants through competition), and simplify and secure the user experience, (and thus lower the rate of shopping cart abandonment).
- Although the Interest Group’s initial focus has been basic ecommerce interactions, there was also interest among Roundtable participants in mobile peer-to-peer payments, especially to empower unbanked populations.
- Many participants expressed the importance of alignment with existing ISO and other international standards to encourage interoperability end-to-end.
Next Steps
The top priority for the next few weeks will be for the Interest Group to incorporate changes into the draft Payment Architecture Working Group Charter and prepare for Membership review of the charter.
The Interest Group will also continue:
- to identify the next set of standardization priorities for topics such as identity and credentials, security, and Web settlement. This includes working to bring stakeholders on board to contribute use cases and advance the work.
- to flesh out a description of a payments architecture and a set of modular capabilities that can be composed to fulfill a variety of use cases.
- to formulate detailed requirements (based on analysis of use cases and capabilities) as input to various W3C Working Groups.
- to liaise with other organizations, understand relevant standards, and encourage alignment with those standards.
We have much to do and need more people to get involved to advance the work at the pace that industry demands.