Magazine article American Banker

MasterCard Forms Link to Ensure Security of Transactions on Internet

Magazine article American Banker

MasterCard Forms Link to Ensure Security of Transactions on Internet

Article excerpt

MasterCard International has aligned itself with Netscape Communications Corp. to ensure security of credit and debit card transactions over interactive networks.

The alliance opens a new frontier of the bank card associations' rivalry. Visa International had previously announced an agreement with Microsoft Corp. to develop a credit card security standard for on-line networks.

MasterCard and Netscape said they will develop an interface to authorize and clear card transactions made on the vast, interconnected cluster of computer networks known as the Internet. Using available data encryption technology, the companies plan to extend this capability to all MasterCard merchants and cardholders as early as midyear.

The urgency for transaction-security standards is driven not only by competition in this area, but the fact that transactions are already taking place - often without a prudent level of security.

"Commerce is already happening on the Internet," said Edward J. Hogan, a MasterCard senior vice president. "It's time for us to bring some order to the proposition."

Visa grabbed the public spotlight in November by teaming with Microsoft, the dominant computer software company. But that did not necessarily assure Visa a premier position in data security.

In an interview days later, Eugene Lockhart, MasterCard's president, revealed that his association "got the same call Visa did," but had chosen not to participate. Mr. Lockhart and his counterpart at Visa, Edmund Jensen, have publicly agreed not to let competitive factors stand in the way of banks' on-line security needs.

Although Mr. Hogan stated that "Visa cannot standardize MasterCard," he did say that both associations and banks that are individually pursuing on-line transaction security would probably come to cooperate on guidelines.

Netscape, the provider of a popular piece of software for navigating across the Internet, has been trying to play a leadership role in bringing data encryption to bear on electronic commerce. …

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