nCipher Announces New payShield Product Line to Help Combat Online Payment Card Fraud.

Business & High-Tech Editors

CAMBRIDGE, U.K.--(BUSINESS WIRE)--Sept. 16, 2002

New Hardware Security Module to support initiatives by

MasterCard International and Visa for more secure Internet and

smart card-based transactions

nCipher plc (LSE:NCH), a leading provider of cryptographic IT security solutions, today announces the launch of payShield(TM), an advanced hardware security module (HSM) designed specifically for the payment processing market.

payShield provides a high performance tamper-resistant security platform to protect cryptographic keys and cardholder authentication processes thereby enabling banks, payment processing service providers and credit card issuers to meet latest industry best practices. payShield is the first HSM to satisfy both the cryptographic security and performance requirements of major initiatives by MasterCard International and Visa to help tackle the escalating costs associated with the fraudulent use of credit cards for online purchases.

payShield is being launched in response to new programs such as MasterCard's Authentication Program, based on the Universal Cardholder Authentication Field (UCAF), and Verified by Visa, based on the 3-D Secure protocol, and represents the convergence of traditional payment processing and Internet security techniques to deliver highly scalable cardholder authentication systems. As part of these initiatives both MasterCard and Visa have defined new techniques for identifying and validating the person making a purchase as well as the credit or debit card used for the transaction. One of the common security requirements established by both MasterCard and Visa is the use of cryptographic hardware security modules, such as nCipher's payShield, to underpin the security of the various cryptographic functions which make up the enrollment and authentication process.

"Initiatives such as 3-D Secure and UCAF are gaining mass acceptance as online banks and merchants understand that there are immediate financial benefits from participation. By mandating the use of a high-grade security infrastructure in order to be a part of the initiatives, there is a real motivation for banks to follow best practice security measures and install the latest in security technology," said Rob Deane, senior analyst, Datamonitor. "With payShield, nCipher has shown that it understands the unique needs of the e-payment space with a hardware security module (HSM) designed to support a variety of e-payment initiatives."

nCipher has partnered with leading e-payment solution providers Arcot Systems and Cyota to ensure full interoperability, optimal performance and ease of deployment for card issuers. In supporting MasterCard's Authentication Program (UCAF and SPA) and Visa 3-D Secure, Arcot TransFort(TM) and Cyota SecureSuite(TM) software products employ nCipher's payShield to perform specific cryptographic functions including; protecting the database of cardholder information through encryption, performing cardholder verification processes and creating digitally signatures to confirm cardholder authentication to merchants creating a legally binding record of the process. payShield, which is currently undergoing validation to meet the exacting FIPS 140-2 Level 3 security standard, also provides high-speed cryptographic acceleration to overcome the heavy processing burden associated with these functions. As a result, payShield significantly increases system capacity and reduces the need for additional servers, a particularly important factor as adoption of the MasterCard and Visa systems becomes widespread.

"Online fraud is a growing global concern and nCipher and Arcot have been working together to provide a solution to ensure safe and more secure online transactions for consumers, merchants and banks," said Ram Varadarajan, President and CEO of Arcot Systems. "Being the first vendor to ensure that nCipher's payShield HSM is operational in this environment, we are jointly able to deliver valuable levels of security and assurance. Therefore, today, we can help card issuers take advantage of MasterCard and Visa's programs, which are anticipated by the associations to reduce e-commerce disputes by up to 80 percent."

"We're extremely pleased to be working with nCipher and can offer innovative 3-D Secure-based solutions to banks and merchants so they can securely authenticate their cardholders when authorizing an online transaction," remarked Amir Orad, Vice President of Marketing and Business Development at Cyota. "payShield will be integrated with Cyota's SecureSuite Platform and utilized in MasterCard SPA and Verified by Visa installations which will give MasterCard and Visa cardholders greater confidence to shop online"

"With initiatives such as MasterCard's Authentication Program (UCAF and SPA) and Verified by Visa and the continued adoption of e-commerce, there are clear signs of convergence between the traditional payment processing market and the latest Internet security techniques to protect sensitive cardholder information, validate an individual's identity and bring provability to electronic transactions," said Richard Moulds, vice president of Marketing at nCipher. "payShield builds on nCipher's core expertise and extends our reach into the payment processing market, which is forecast to reach $2.4Bn by 2005(1), and represents a tremendous new market opportunity for the company."

Availability:

payShield is available immediately. Pricing starts from $25,000.

About MasterCard International

MasterCard International has a comprehensive portfolio of well-known, widely accepted payment brands including MasterCard(R), Cirrus(R) and Maestro(R). More than 1.7 billion MasterCard, Cirrus and Maestro logos are present on credit, charge and debit cards in circulation today. A corporation with more than 15,000 member financial institutions, 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(R) 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 http://www.mastercardinternational.com.

About Verified by Visa

Verified by Visa is a new service that Visa has recently launched in the US and is currently rolling-out in the EU region. It is based on Visa's 3-D Secure technology and is a means of authenticating both the cardholder and merchant to ensure they are both who they say they are. It means that, when making a transaction, cardholders would confirm their identities using, for example, a password in the same way that today they provide their signature when shopping in the high street. The issuing bank authenticates the cardholder during the sale and notifies the merchant that the buyer is legitimate, increasing consumer confidence as the online shopping experience becomes a safer everyday occurrence.

About Arcot

Arcot Systems, Inc., is the leading provider of authentication solutions for securing identity in Internet-scale, transactional and wireless environments. Only Arcot provides cost-effective, scalable, software solutions based on the ArcotID(tm) Software Smart Card for strongly authenticating users and transactions for payment systems, Web-based email, Web portals and Virtual Private Networks. Arcot solutions meet the business need for strong transactional security while providing the customer a user-friendly experience with anytime, anywhere convenience. Serving over 4000 customers that are leaders in financial services, healthcare, and e-commerce, Arcot delivers solutions to protect their customers' privacy and reduce online fraud. For more information, visit www.arcot.com

About Cyota

Cyota is the leading payment security provider for financial institutions. Cyota currently has systems available to over 300 million cardholders North America, Europe and Asia-Pacific. Cyota SecureSuite is the only integrated payment security platform, designed to seamlessly integrate a wide range of credit and debit card security solutions including Verified by Visa, MasterCard SPA, surrogate numbers and more, into a single, consistent and cost-effective solution. Founded in 1999, Cyota is headquartered in New York with offices worldwide. Cyota is led by a respected management team with extensive experience in the security, Internet and banking industry. For more information please visit www.cyota.com

About nCipher

nCipher is redefining cryptographic security to protect points of risk across the enterprise-from network appliances to Web servers, to custom software applications and back-end databases. nCipher provides hardware and software solutions that enable organizations to implement best practice security by addressing the challenges of cryptographic key management and performance. Many of the world's leading organizations - from Microsoft and Barclays Bank to PricewaterhouseCoopers and the U.S. Navy - rely on nCipher to deliver a sound e-security infrastructure. nCipher's products are particularly well suited to organizations with high volumes of security-sensitive transactions, such as banking and financial institutions, government departments, e-retailers and online service providers.

nCipher is listed on the London Stock Exchange as a TechMARK 100 company (LSE:NCH) with offices in Cambridge, UK; Boston, New York, Paris, Hamburg and Tokyo. For more information on nCipher, visit www.ncipher.com.

(1) Source - Datamonitor, ePayment technology in Europe and the US:

Cashing in on the payment revolution, March 2002

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