OPERA - Open Payments European Research Association
by Rafael Hirschfeld
The Open Payments European Research Association (OPERA) is investigating
the use of a multi-currency cross-border electronic purse based on smart
cards and hand-held infrared wallets. A multinational trial is currently
underway in Belgium and Greece.
The technology employed by OPERA was developed by another European project,
CAFE, which concluded in February of 1996. The CAFE project was carried
out by academic and industrial partners, but the consortium did not include
financial institutions. Instead, a group of financial institutions sponsored
the CAFE trial and made up the initial partners of OPERA. They include
the two largest commercial banks in Greece: the National Bank of Greece
and the Commercial Bank of Greece.
The CAFE wallet combines conventional and digital money storage.
OPERA picks up where CAFE left off, and aims to test the electronic
purse in a multinational environment with a view to possible future commercialisation.
There are a number of commercial electronic purse trials underway throughout
Europe and around the world. The OPERA purse, called Xchange, differs from
these systems in that it is far more technically advanced but also far
less commercially developed. Some specific differences include:
Public-key
The security of most commercial electronic purses is based on secret-key
(symmetric) cryptography. This requires that the information stored in
the merchant terminal be protected by some sort of tamper-resistant device
(called a security module), because if it were revealed it could be used
to generate value. The Xchange system is based entirely on public-key (asymmetric)
cryptography, so there are no secrets in the terminal; accepting payments
is simply a matter of additional software and no special trust relationship
with the merchant is required. This allows greater flexibility for inclusion
of not only arbitrary merchants but also multiple issuers of electronic
value.
Multi-currency
Most commercial electronic purses (with the notable exception of Mondex)
operate in a single currency. Mondex cards have pockets for multiple currencies,
but the merchant must accept one of the currencies present in the purse.
The Xchange purse includes a conversion mechanism that enables the merchant
to obtain payment in its local currency from a purse loaded only with foreign
currencies. Although this mechanism is fully general, in the OPERA trial
the ECU is used as a medium of exchange: the cardholder can spend her home
currency in her home country, and ECU anywhere. This is done in anticipation
of EMU in order to allow people to try out the use of the ECU/Euro. Already
ECU loaded in Brussels (converted from Belgian francs) have been successfully
used in Athens to purchase items priced in Greek drachma.
Signature transport
Digital money in the research literature somewhat resembles physical
cash in that electronic banknotes are produced by the issuer and are only
carried by the card. Unfortunately, such banknotes are too bulky for a
smart card to store a sufficient number of them, so most electronic purse
systems adopt a counter-based approach: the card generates money based
on the balance in a counter, which is then decremented. This is tantamount
to allowing the card to print its own banknotes, and if the physical security
of the card is compromised, the potential loss is unlimited. The Xchange
purse uses a hybrid approach: the card 'prints money' from a stored balance
as in other counter-based systems, but only on special paper (in the form
of signed certificates) that is supplied by the issuer in limited quantities.
That way, if the protected area where the 'plates' are stored is in some
way compromised, the loss is limited. The basic security approach is to
store as much as possible of the information needed for generating electronic
value at the issuing bank rather than on the card.
Anonymity
Anonymous payments are supported. As electronic purse technology rushes
in to capture low value cash payments, many have raised concerns about
consumer privacy. Although this is more a societal or legal issue, the
availability of technology to support anonymous payments allows the choice
to be made purely on societal grounds. In the Xchange system, anonymity
is an issuer option, and it is possible to mix some issuers that provide
it with others that do not. Anonymity is one-way, ie, it is always possible
for the payer to prove to which payee she made a particular payment. This
addresses many of the serious objections to fully anonymous payments while
still protecting the privacy of consumers' spending habits.
Recovery
Recovery of lost, stolen, and damaged cards is supported. Because the
privacy features preclude mirroring of the cards (except in debugging versions
of the system), cardholders may have to wait before recovering the value
on their cards, but they can eventually recover any value remaining on
their card at the time they report its loss.
Contactless transactions
Contactless transactions can be performed via infrared wallets. In principle
these could be the consumer's own computer or personal digital assistant.
In addition to convenience in particular situations (eg parking garages),
the cardholder can complete the transaction through her own trusted device,
which displays the amount requested and asks for confirmation. By analogy,
the contactless payment can be likened to taking the appropriate amount
of money out of one's wallet and handing it to the cashier, whereas payment
with a smart card is more like handing over one's entire wallet and asking
the cashier to take the correct amount. This becomes even more dangerous
when the wallet contains other things besides cash, such as credit cards,
credentials, room keys, etc.
Openness
The cryptographic protocols used to secure most commercial systems are
shrouded in secrecy. By contrast, the protocols employed by the Xchange
purse are published and open to public scrutiny. It is believed that only
by subjecting the protocols to attack by the wider research (and hacker)
community can they be sufficiently hardened, and that only by making them
known to all can they be trusted by all. In principle, anybody can follow
the specifications and make compliant devices.
Although the primary technical aspects of the OPERA purse were developed
within the CAFE project, OPERA is developing technical extensions of its
own. These include an unattended reloading device, which interfaces to
the banking network to load money from the purseholder's bank account,
or which can accept cash coins and bank notes. Also investigated is the
addition of debit and credit facilities, compliant with the specifications
of Europay, Mastercard, and Visa (EMV), alongside the purse. These extensions
are being developed primarily by Mellon Technologies and Ethnodata, both
based in Athens.
At the moment, the OPERA trials are limited in size and scope. There
are real users, but they are limited to employees of the institutions involved
in the trial. Experience is being gained, however, that could ultimately
lead to a commercial system. Although any commercial deployment would probably
require reimplementation of much of the system, OPERA will have demonstrated
the feasibility.
Finally, it is worth pointing out that OPERA also stands for interOPERAbility.
Although the current focus is on the Xchange electronic purse, OPERA remains
committed to the CAFE vision of the electronic wallet as a user's device
for managing relationships with several issuers, application providers,
etc, including possibly several (competing) electronic purses on the same
device, and with none of the applications compro-mising the security of
any of the others.
Please contact:
Rafael Hirschfeld - CWI
Tel: +31 20 592 4169
E-mail: ray@cwi.nl
The OPERA secretariat - CardWare Ltd.
Tel: +44 1582 760664
Fax: +44 1582 764518
E-mail:100116.424@compuserve.com
