The Story of One Solution as a Reflection of Business Transformation

Every business eventually faces the same question: where to find new growth. In the acquiring industry, this question has become especially relevant as traditional retail payment infrastructure reaches maturity in many markets.

Across Europe, contactless payments are widely adopted. Terminals operate reliably in stores, supermarkets, and fuel stations. However, growth no longer comes from traditional retail chains. It comes from segments that historically lacked access to payment infrastructure.

Micro and small merchants represent one of the most promising areas. Market vendors, delivery couriers, seasonal traders, service professionals, and mobile sellers often require flexible and low-cost acceptance tools. In tourism-driven economies, infrastructure must scale rapidly at the start of a season and contract just as quickly afterward. In such scenarios, traditional terminals create logistical and financial overhead.

Our contactless payment solution tapXphone addresses these gaps by enabling payment acceptance where it was previously unavailable or impractical. Instead of deploying dedicated hardware, merchants use their own smartphones. Payments become a software capability rather than a physical device. This approach aligns with national and regulatory objectives to increase the share of cashless transactions and improve financial inclusion.

Evolution Toward tapXphone

IBA Group has been working in payment technology for more than a decade. Our expertise in EMV transaction processing began to take shape in 2010. In 2015, we launched our fist mPOS solutions. These solutions connected a mobile device to a small external card reader via Bluetooth. At the time, they reduced hardware costs and increased mobility.

As NFC technology expanded and smartphones became ubiquitous, the next logical step emerged. Why not eliminate the external reader entirely and accept payments directly on the phone?

Initially, two barriers stood in the way. NFC-enabled devices were limited and the payment industry relied heavily on hardware-based security models. Payment acceptance involves sensitive card data and fraud risks are significant. Industry confidence in purely software-based acceptance required time to develop.

By 2019, market conditions shifted. NFC penetration increased, mobile ecosystems matured, and payment networks introduced the first Tap-to-Phone programs. At a Visa industry forum that year, IBA Group was invited to explore whether such a solution could be developed quickly in the region. A pilot was launched within two months.

The first commercial deployment followed in Kyiv in the summer of 2019. Built on IBA Group’s proprietary payment platform and EMV kernel expertise, tapXphone became one of the earliest mobile payment acceptance solutions globally.

Digital Payment Terminal

Contactless payment acceptance, also known as SoftPOS, Tap to Phone or Tap on Phone, represents a significant shift in payment acceptance. A typical Android or iOS device becomes a certified payment terminal.

From a transaction perspective, there is no difference between a traditional EFTPOS device and tapXphone. Both rely on EMV technology, both communicate with the chip embedded in a card or a mobile wallet, and both process transactions according to international payment network standards. The difference lies in security architecture.

Traditional terminals rely on certified hardware components to protect sensitive operations. SoftPOS solutions operate within consumer devices that are not inherently secure. Security must therefore be built at the software level.

tapXphone creates a trusted execution environment inside the mobile device. Before each transaction, the application evaluates device integrity, verifies system status, checks for tampering or rooting, and ensures compliance with security policies. Only after successful validation the transaction goes on. All sensitive card data is encrypted and transmitted to the acquiring bank for processing. Data is not stored on the device. The solution complies with the PCI MPoC standard, the industry framework for mobile payments on commercial off-the-shelf devices.

Supporting High Value Transactions: PIN on Glass

Contactless payment acceptance initially focused on low-value contactless transactions. As the technology matured, support for higher-value transactions became essential.

tapXphone implements PIN on Glass functionality, which allows customers to enter PIN directly on the smartphone screen. This feature is protected by strict PCI standards and includes dynamic keypad layouts, anti-screen-recording protections, and safeguards against motion-based inference attacks. The result is the full transaction capability comparable to a traditional terminal, including high-value payments that require cardholder verification.

Android and iOS Deployment

Early contactless payment acceptance solutions were launched on Android due to its open architecture and broader NFC accessibility. Eventually, Apple introduced its Tap to Pay framework. Given prior collaboration on transport and digital payment initiatives, and partnerships with leading payment providers, IBA Group became one of the early global participants in Apple’s program. As a result, tapXphone now operates on both Android and iOS platforms.

Beyond Contactless Cards

Payment ecosystems continue to evolve. In addition to contactless card transactions, markets increasingly adopt QR payments, account-to-account transfers, and domestic alternative payment schemes.

tapXphone is fully digital and it allows easier integration of additional payment methods within a single application environment. Merchants avoid maintaining separate devices for different payment channels. A smartphone can consolidate multiple acceptance technologies into one platform. This flexibility strengthens merchant adoption and simplifies customer experience.

Security and Certification as an Ongoing Process

Developing a contactless payment acceptance solution is not a one-time certification exercise. It requires continuous compliance across multiple frameworks. tapXphone undergoes recurring EMV kernel certifications, PCI DSS audits, PCI MPoC validations, PCI PIN compliance audits for PIN entry, vulnerability assessments, and annual penetration tests. Payment network programs such as Visa Tap to Phone introduce additional brand-level requirements. Security governance forms part of the product lifecycle. Mobile threats evolve constantly and secure software development practices must adapt accordingly.

Technical Challenges and Market Readiness

One of the primary challenges during development was uncertainty. In the early stages of mobile payment acceptance solutions, standards were in their infancy. Requirements evolved rapidly and the industry lacked clear guidance.

Another enduring challenge is cybersecurity. Software-based acceptance introduces flexibility but requires disciplined development processes, proactive vulnerability management, and continuous monitoring of emerging threats.

Integration with banking systems, however, remained straightforward. tapXphone preserves established EMV transaction logic and acquiring flows. Banks that already process card transactions can integrate the solution with minimal structural change.

Redefining Payment Infrastructure

tapXphone reflects the broader transformation of payment acceptance. What once required specialized hardware can now be delivered through certified software on everyday devices.

For banks, this expands acquiring reach. For merchants, it lowers entry barriers. For regulators, it supports the shift toward cashless economies. Combining EMV expertise, proprietary technology development, and compliance with global security standards, IBA Group continues to advance digital payment acceptance through the tapXphone solution.

The story of tapXphone is ultimately a story of business transformation. What began as a response to a specific business request evolved into a new way of payment acceptance that opened new opportunities for micro businesses and individual entrepreneurs. The story demonstrates that successful transformation is not driven by technology alone, but by the ability to connect innovation with real business needs and customer expectations. Solutions like tapXphone show how the right combination of technology, expertise, and a clear vision can turn change into sustainable progress.

Contact to discover how we can help your business unlock new opportunities and build a stronger foundation for the future.