Proxama, a U.K.-based provider of mobile proximity marketing, wallet and payment technology, has partnered with security developer Cryptomathic to launch a mobile contactless payment solution called EMV Tokenised Transaction, or EMV-TT, according to an announcement from the companies.

The solution is based on Host Card Emulation, which enables NFC applications on Android devices to emulate smart cards and financial institutions to host payment accounts in a virtual cloud. Without HCE, NFC-based cards need to be stored in a secure element that is embedded in a mobile phone or stored in a SIM card and is controlled by a mobile operator.

By eliminating the need for a secure element, HCE enables contactless payments to be made in the same way as using a contactless card, securely, via any NFC mobile handset. Earlier this month, Visa and MasterCard announced support for HCE.

Proxama and Cryptomathic's EMV-TT solution can be used to enable existing mobile applications with a new software-based security infrastructure that works across debit, credit, prepaid and gift card schemes, the two firms said in a press release. EMV-TT does not require any POS infrastructure changes to be made by merchants, as it works with existing contactless payment terminals.

With EMV-TT, any card issuer can now launch a mobile contactless payment service without having to rely on a secure element provider or Trusted Service Manager, cutting down on complexity and cost and providing greater flexibility for value added services, Proxama and Cryptomathic say. As a standalone solution, EMV-TT leverages existing card issuance and authorization systems and Proxama's TapPoint service platform and mobile wallet software development kits. TapPoint offers mobile marketing and loyalty, wallets and payment applications.

EMV-TT has been designed to enable a simple migration from HCE to the standard secure element-based approach or vice-versa, should a bank or network operator wish to change its deployment or partner strategy in the future.

"We're seeing a lot of change in the payments industry, and consumers are increasingly comfortable with card-based contactless payments, with huge appetite to use their smartphone more," Neil Garner, Proxama's CEO, said in a statement. "The EMV-TT solution developed in partnership with Cryptomathic enables card issuers to offer mobile contactless as part of their existing service offering."

With more NFC devices rolling out every day and HCE available on the vast majority of Android devices running the latest Android OS, KitKat, the market opportunity for NFC payments is growing, Garner said. "We have designed EMV-TT so that it seamlessly integrates with other mobile consumer engagement services delivered from our TapPoint platform," he said.