Contactless Payment Cards Offer Convenience and Speed, Raising Interest Among U.S. Retailers Says New Alliance White Paper

Contactless Payment Cards Offer Convenience and Speed, Raising Interest Among U.S. Retailers Says New Alliance White Paper

Princeton Junction, NJ, March 4, 2003–Consumers and retailers alike are attracted to the dual advantages of fast and convenient payment using contactless technology, generating more interest and numerous implementations and pilot trials here in the United States, according to a new Smart Card Alliance white paper released today.

“Anyone who has ever seen a contactless payment take place at a highway tollbooth understands two things about it–it is fast and convenient,” said Randy Vanderhoof, executive director of the Smart Card Alliance. “Places where speed and convenience are important are the places where the trend to use contactless payment is starting–gas stations, convenience stores, fast food restaurants, transit systems and other venues where people are on the go.”

“We decided it was a good time to look at this trend both in North America and around the world. Since we defined contactless payment in a very broad way, our newest white paper covers all of the primary contactless radio frequency (RF)-based payment technologies in use, as well as technologies that are only in early pilot or concept evaluation phases like infrared, Bluetooth and mobile phones. The paper serves as a global information sourcebook on contactless payment applications and technology,” continued Vanderhoof.

“Contactless Payment and the Retail Point of Sale: Applications, Technologies and Transaction Models” provides a comprehensive look at several existing contactless programs around the world, presenting details on the numbers of cards issued, the technology used, the transaction model and any additional applications involved. Other topics are:

  • The benefits and costs of contactless payment for retailers and issuers
  • The case for using contactless technology for payment
  • Business-case and technology considerations
  • Contactless payment technology options, including both RF and other technology alternatives
  • Contactless payment transaction models

“This white paper will serve as an excellent tool for anyone evaluating a contactless payment program. The Smart Card Alliance, representing organizations throughout the payment and technology industries, has done a good job of articulating the key aspects stakeholders need to consider when moving forward with their own contactless payment program,” said Michael Madden, vice president, e-business development, MasterCard International. “MasterCard’s own unique experience with MasterCard PayPass, and the many technology providers and merchants we’re working with to implement our contactless payment program, is reflected in the learnings shared in the white paper.”

“As consumers and merchants increasingly look for ways to migrate from cash, contactless technology joins a host of other options that complement traditional mag-stripe cards,” said Tolan Steele, vice president of end-user technology, Visa USA. “Visa is committed to delivering solutions that give consumers flexibility in how they use and access their accounts, and to providing merchants with cost-effective means of electronifying paper transactions. The continued examination of contactless technologies, contact-based smart cards, and other innovations in the United States and other parts of the world are critical to helping merchants evaluate and plan for their evolving payment needs.”

Alliance members from 22 organizations, both public and private, were involved in the development of the white paper. Lead contributors included representatives from ASSA ABLOY Identification Technology Group, Atmel, Cubic Transportation Systems, First Data Corp., JCB International Credit Card Co., MasterCard International, NTRU Cryptosystems, Inc., Philips Semiconductors, Potomac Systems and Technology, Proton World, SchlumbergerSema, Smart Commerce Inc., Washington Metropolitan Area Transit Authority (WMATA), Visa International and Visa USA.

The report, written for executives and managers, is available to both members and non-members at no charge at http://www.securetechalliance.org.

The Smart Card Alliance will also be discussing contactless payment during its first Smart Talk teleconference on April 3, at 1PM Eastern Time. Alliance members will be presenting perspectives on the contactless payment market and key implementation technologies during this session. Additional information and registration for the teleconference are available at http://www.securetechalliance.org.

About the Smart Card Alliance

The Smart Card Alliance is a not-for-profit, multi-industry association working to accelerate the acceptance of smart card technology. Through specific projects such as education programs, market research, advocacy, industry relations and open forums, the Alliance keeps its members connected to industry leaders and innovative thought. The Alliance is the single industry voice for smart cards, leading industry discussion on the impact and value of smart cards in the U.S. For more information please visit http://www.securetechalliance.org.