SECURITY SOLUTIONS

Even in today ’ s digital-first economy , connectivity issues can present challenges for digital payment transactions , especially in rural areas . The lack of connectivity may be due to a power outage , the absence of a strong Internet signal or a telecommunications failure . The efficiency of online payment systems is fundamentally linked to the availability of a stable Internet connection . In highly industrialised economies , Internet access is not uniformly reliable . In developing countries , the situation is particularly challenging as the infrastructure for reliable Internet access is often insufficient . These outages result in the inability of individuals to access financial services and to perform the services themselves . Incorporating offline capabilities into digital payments can overcome these challenges .

The Bank for International Settlements ( BIS ) defines offline payments as the transfer of a digital money token between devices that takes place without the payer and payee requiring a networked connection to any ledger system or backend system to complete the payment .

G + D Filia Unplugged makes digital offline transactions a reality . It can be integrated seamlessly into existing digital payment offerings , including commercial banks ’ tokenised deposit systems , instant payment systems or mobile money services . The solution is designed with three protection layers and cash-like features to provide reliability , security , and trust while functioning independently of Internet connectivity . The introduction of a token-based solution such as G + D Filia Unplugged not only strengthens payment resilience but also has the potential to drive financial inclusion for nearly 1.4 billion unbanked people worldwide .

How Filia Unplugged works

G + D Filia Unplugged provides digital payments with the same advantages as cash , including privacy protection , and high levels of data security . For societies that primarily use cash , this new feature offers significant opportunities . It provides another convenient and secure method for people to make digital transactions without the need for expensive devices like smartphones . A simple smart card can help them start making digital transactions at a low cost .

The offline function also enables use cases such as peer-to-peer payments ( P2P ) between individuals or payment-tobusiness payments ( P2B ). The technology behind G + D Filia Unplugged functions like many streaming services , which allow users to download audio or video files that can then be played offline . The solution stores monetary tokens on a hardware wallet ( e . g . the SIM card of a smartphone ) and requires only two wallets to operate , which can then be used without an online connection , for example via Near Field Communication ( NFC ).

Offline payment functionality offers benefits for all stakeholders in the financial industry

As a BIS study from 2023 underlines , offline functionality is also a necessity for a Central Bank Digital Currency ( CBDC ), which is currently being explored by numerous central banks worldwide . The success of several CBDC pilot projects around the globe has demonstrated the importance of offline payments . This has highlighted the significance of CBDCs mirroring cash-like features like data security and privacy , with the ability to operate offline as a fundamental component . At the same time , commercial banks , Fintechs , instant payment systems and service providers for mobile payments benefit from the integration of offline capabilities into their payment systems . This allows the expansion of their customer base by offering more inclusive and resilient payment services .

“ Offline payments are the missing link in the digital payment sphere . With Filia Unplugged , we are helping to bridge this gap ,” explained Dr Raoul Herborg , Managing Director Central Bank Digital Currency at G + D . “ The capability of paying also offline in an existing digital system can enhance financial inclusion and payments resilience , support cash-like features in the digital world , and drive innovative use cases for the tokenised economy .” � www . intelligentfin . tech

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