[THE INVESTOR] SINGAPORE -- Korean digital security startup SSenStone on March 14 launched a brand new way for safer online credit card use -- a one-time credit card number that changes every time a new transaction is made.
The technology, called Virtual One Time Code, or VOTC, creates virtual numbers that cannot be duplicated for more than 1 million uses. More importantly, the firm said, the number recognizes the cardholder every time without any network connection.
“We are in talks with several credit card firms for possible partnerships,” SSenStone CEO Yoo Chang-hun told The Investor on the sidelines of Money20/20 Asia in Singapore this week.
“A one-time credit number is the ultimate solution to combating credit card fraud.”
SSenStone was one of the top five security solutions firms that participated in the startup pitching event during the three-day Asian edition of the world’s largest fintech trade show that ended on March 15.
According to the CEO, chipped cards and upgraded security solutions may have drastically reduced credit card fraud offline but card-not-present online transactions have become increasingly vulnerable to scammers.
Of the total credit card fraud losses worth US$21 billion globally, more than 70 percent now comes from CNP fraud, mostly on e-commerce transactions.
“The beauty of our technology is there is no need to install extra machines or infrastructure to apply it. We can block all cases of CNP fraud, without more complicated token methods,” Yoo said.
The firm hopes to supply the solution to card issuers or card companies and charge them licensing fees on each card account, while seeking a strategic alliance with online payment service providers and security companies to create a new business model based on revenue sharing.
“Our aim is not to compete against existing solutions. We want to collaborate with them to create a new eco-system for payment security,” the CEO said.
SSenStone, established in 2015, develops next-generation authentication solutions and its Fast Identity Online or FIDO-certified platform, called StonePASS, has been widely adopted by Korean financial and public organizations.
The firm’s annual revenue is estimated to reach 50 billion won (US$46.5 million) this year. Its key investors include SparkLabs and Lotte Accelerator. Last year, Lee Joon-ho, former chief information security officer at Korean internet giant Naver, joined the firm as co-CEO.
By Lee Ji-yoon (firstname.lastname@example.org)