MasterCard Puts Contactless Smart Card To The Test
A variety of retail merchants in the Orlando area are helping MasterCard and its technology solution provider partners test the waters with a new POS contactless smart card called PayPass.
Toni Merschen, senior vice president of the Chip & Mobile Commerce Center of Excellence at MasterCard, said although it's still too early to make any definitive conclusions about the PayPass pilot program, initial feedback has been positive.
"Contactless payments are a very successful application, globally, in transport and other areas where speed of transaction is of the essence," said Merschen. "We're doing the pilot in Orlando to confirm these assumptions here in the United States and, if they are confirmed, we expect the issuers and merchants will make this a broader exercise."
As part of the Orlando pilot program, MasterCard, in conjunction with Chase, Citibank and MBNA, are enabling customers to use the card's tap-and-go feature at City of Orlando Parking, Friendly's, McDonald's, Loews Universal Cineplex, Ritz Camera and Boaters' World.
Consumers tap or wave their PayPass payment card on a specially equipped POS merchant terminal that then transmits payment details wirelessly. The pilot program builds upon a successful employee pilot last December at MasterCard's Purchase, N.Y., headquarters, according to the company.
Initial results from that employee pilot showed that purchase transaction times were cut by up to 64 percent, MasterCard reported. In addition, the average transaction amount increased by 10 percent when employees used a payment card instead of cash, the company reported.
MasterCard chose to partner with Israel-based On Track Innovations (OTI) and is using its smart-card technology and card reader, drive-through and personalization solutions for both the employee pilot test and the PayPass pilot program in Orlando.
Ohad Bashan, president and CEO of OTI America, Cupertino, Calif., said OTI is excited about the opportunity to work with MasterCard and the chance to get a jump on the U.S. market as the technology becomes more widely accepted.
"Obviously, the micro payment market represents a significant market for OTI," said Bashan. "We believe the U.S. market is making the right choice by leap-frogging over the smart-card solution, which has no real value for consumers, and going directly to the contactless smart-card solution, which is a faster, more secure solution."
Microprocessor chips are at the heart of the most powerful type of smart cards because multiple applications are possible on a single chip, which can be reprogrammed after the card has been issued, Bashan said. Microprocessor cards also have the power to process security algorithms that encode and secure the card's data, he said.
OTI's contactless microprocessor products are based on a common platform consisting of OTI's smart cards, readers, application development software and communications technology designed to provide secure, reliable, end-to-end communication.
OTI typically integrates its contactless smart-card solutions with customers' existing POS systems, so there is no significant cost to the retailer, according to Bashan. "The main approach we are taking is working with retailers' existing POS systems and then adding OTI's contactless capability to that equipment," he said.
Randy Vanderhoof, executive vice president of the Smart Card Alliance, a non-profit association whose members advocate the use of smart-card technology in North America, said the market is starting to warm up to the idea.
"We have begun to create some dialogue about next-generation payment systems and retail stores and where the role of smart cards may fit," said Vanderhoof, who previously worked as a senior project manager for IBM Global Smart Card Solutions.
Smart Card Alliance members recently expressed a "tremendous amount of excitement" about the potential for contactless smart cards, particularly targeted toward the quick-service segment of the retail market, he said.
"They are seeing a shift where they've been trying to push contact smart-card technology to the issuing banks, with limited adoption," said Vanderhoof. "But they've found there's much more interest, at least initially, with this contactless payment technology."
|
Thread abonnieren
