what is host card emulation (hce)?

What is Host Card Emulation (HCE)?

Android KitKat 4.4 enables NFC-based transactions through host card emulation (HCE).

First, what is card emulation?

Card emulation allows a mobile device to mimic a payments card.

In essence, the device becomes a contactless card.

This card can be used to make purchases, display tickets and present identification.

It transmits the data received from the terminal between the NFC device to the secure element (SE).

The physical SE is embedded in the phone or contained within the SIM card/ UICC.

However, using a physical SE for mobile payments has its downsides:

1. Complex business models are required to gain access.

2. This creates dependencies that make it complex and expensive to interact.

3. Application issuers need agreements with SE issuers who need to connect with the mobile handsets.

4. Limited storage capacity of the SE and processing speed.

HCE enables the SE to be placed in a hosted cloud environment, rather than the mobile device.

Service providers can take control of their applications by insourcing an SE in the Cloud platform:

1. It eases the use of NFC mobile payment services.

2. Application issuers can provision their apps directly to the device without third party intervention.

3. It shortens the value chain as fewer parties need to be involved, lowering provisioning costs.

4. Direct access to the SE enables instant fraud detection and allows immediate blocking on apps.

5. Greater processing power and storage capacity that enables more advanced risk management.

6. Without intermediaries the gap between application issuers and consumers becomes smaller.

This results in consistent brand and user experience across all NFC services.

Interested in host card emulation and its influence on the industry? Watch our video.

Bell ID Secure Element in the Cloud.

With over 20 years of expertise, Bell ID is considered the world’s leading provider of lifecycle management solutions for tokens (e.g. smart cards, mobile NFC phones) deployed in single and multi-application programmes.

www.bellid.com

Andre StoorvogelMarketing Manager

a.stoorvogel@bellid.com