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MasterCard To Test 'Contactless' Cards
Consumers holding a new type of MasterCard will soon be able to walk up to a machine and wave or tap their cards to make purchases, if all goes smoothly in a pilot program the company is testing in Florida.
The program is similar in consumer operation to the SpeedPass concept Exxon/Mobil has been offering successfully for several years.
Holders of MasterCard's PayPass cards don't hand over their cards to a merchant to be swiped through a machine. Instead, they simply walk up and flash their cards, which have an embedded computer chip and antennae that talks to specially equipped merchant terminals. The cards transmit payment details wirelessly, and those details are processed through MasterCard's acceptance network.
The banks issuing the card include Chase, Citibank and MBNA, and the cards are being tested through merchants in Orlando, FL. Those merchants include fast food places, retailers, theaters, and the city's parking authority.
According to MasterCard, its research indicates that consumers would use the cards in place of cash, would spend more per transaction, and that they consider the payment method innovative and "fun." A pilot test the company conducted indicated transaction time was reduced by up to 64 percent, while average transaction amounts increased by 10 percent.
Copyright © 2003 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 12, No. 11, 2/03
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