feedback received from its member financial institutions around the world,
MasterCard announced the release of MasterCard M/Chip, version 4
(M/Chip 4), a highly flexible smart card application for credit and debit
cards. The new version contains a range of features designed to tackle many
of the industry’s most pressing needs and takes full advantage of the
benefits brought by EMV 2000.
The M/Chip payment application, which enables financial institutions to
issue MasterCard-, Maestro- and Cirrus-branded smart cards on a chip
platform, was first introduced in 1998 as an integrated credit/debit
offering, based closely on the global EMV specifications. Since that time,
more than 200 MasterCard members have either issued or are implementing
chip based credit or debit cards in many key markets across the globe,
including Japan, the United Kingdom, France, Germany, Italy, Korea, Taiwan,
Brazil, Mexico and South Africa. Realizing that the business case for each
of these projects varies, MasterCard offers the most flexible and robust
A Complete Solution
M/Chip 4 builds on MasterCard’s market experience, delivering the most
comprehensive, and flexible guidelines for introducing chip-based credit
and debit cards. With M/Chip 4, MasterCard is giving the industry the
tools to deploy a wide range of unique, but technically consistent and
globally interoperable MasterCard smart cards.
To ease adoption, MasterCard is initially delivering specifications for two
distinct M/Chip programme profiles, each strategically designed to meet the
needs of today’s issuers. These programme profiles are:
MasterCard M/Chip Lite – a streamlined version of MasterCard M/Chip
using the version 4 specifications for cards. It is a cost-effective
solution that provides members with a smooth start to their chip
MasterCard M/Chip Select – a more sophisticated and feature-rich
implementation of MasterCard M/Chip that offers all the advantages of
M/Chip Lite, in addition to RSA computing facilities that carry out
sophisticated security functions like dynamic data authentication as
defined in the EMV specifications.
Through the two programmes, MasterCard’s members are offered an easy
migration path to chip and MasterCard has ensured that both programmes can
be implemented on all major smart card platforms (MULTOS, JavaCard, and
“Every market is different when it comes to smart cards,” said Toni
Merschen, senior vice president, Chip and Mobile Commerce Center of
Excellence, MasterCard International. “We take customer input seriously,
and have enriched M/Chip to make it more flexible and powerful for our
issuers around the world. We believe M/Chip 4 will continue to build the
strong momentum for chip migration over the next year.”
Added Benefits for Issuers
M/Chip 4 is designed specifically to give card issuers more functionality,
service and control. In addition to the flexibility outlined above, M/Chip
4 provides added features MasterCard’s issuers and vendors have requested,
both in enhanced risk management and value added services.
In accordance with the EMV 2000 specifications, M/Chip 4 implements a
new EMV defined session key algorithm, benefiting card issuers that want
a single authorisation process regardless of application provider, while
providing additional protection from DPA (differential power analysis)
M/Chip 4 has the ability to store the last ten transactions, including
information such as: transaction amount, transaction currency,
transaction date, the card’s cumulative transaction counter and whether
the transaction was approved, declined or went online for authorisation.
Card issuers can segment their portfolios and control card use at
specific merchant categories. For example, the M/Chip 4 application on
a fleet card can approve offline transactions at designated merchants
only. It can also be used to decline off line transactions at specific
merchants. In both cases, this is defined by the issuer during each
M/Chip 4 cards can be used in conjunction with MasterCard SecureCode to
generate the authentication data necessary to guarantee e-commerce
transactions. This programme, called Chip Authentication Programme, is
one of three cardholder authentication solutions MasterCard is making
available to its issuers as part of its new global MasterCard SecureCode
M/Chip 4 will help expand physical world card acceptance by enabling
secure, offline debit transactions to take place. The specifications
include commands that facilitate implementation of an offline debit
programme, using the same application platform and infrastructure as the
one used for traditional debit or credit programmes. This programme will
allow issuers to maximize their infrastructure investment.
M/Chip 4 makes it more cost effective for issuers to offer smart cards.
Because it is a global standard with broad industry support, there is
less need for issuer customisation which drives down the overall costs.
Since the implementations will all be based on the single M/Chip 4
global standard, issuers will be better able to compare vendor offerings
“Smart cards offer MasterCard’s members enormous potential for building
their existing business,” Merschen continued. “Our OneSMART platform,
built around M/Chip 4, represents an all-in-one package for strengthening
customer relationships and greatly reducing card fraud, processing costs,
and chargebacks, while expanding card acceptance in markets that were
previously off limits. That’s a powerful combination of benefits.”
About MasterCard Global e-Business
MasterCard International is a leader in global e-business. MasterCard is
focused on providing its member financial institutions with customised,
meaningful global e-business solutions that connect them to their
accountholders. Through its investment in industry innovation,
participation in standards development and business alliances, MasterCard
is staying in the forefront of technology integration to enable anytime,
anywhere payments across multiple channels and various devices.
MasterCard’s global e-business solutions include Internet security, smart
cards, mobile commerce/wireless, business to business electronic commerce,
and numerous emerging technologies.
About MasterCard International
MasterCard International has a comprehensive portfolio of well-known,
widely accepted payment brands including MasterCard, Cirrus and Maestro.
More than 1.7 billion MasterCard, Cirrus and Maestro logos are present on
credit, charge and debit cards in circulation today. With approximately
25,000 MasterCard, Cirrus and Maestro members worldwide, MasterCard serves
consumers and businesses, both large and small, in 210 countries and
territories. MasterCard is a leader in quality and innovation, offering a
wide range of payment solutions in the virtual and traditional worlds.
MasterCard’s award-winning Priceless advertising campaign is now seen in 90
countries and in 45 languages, giving the MasterCard brand a truly global
reach and scope. With more than 28 million acceptance locations, no
payment card is more widely accepted globally than MasterCard. For the six
months ended June 30, 2002, gross dollar volume exceeded US$534 billion.
MasterCard can be reached through its website at