Staff at the Royal Bank of Scotland’s head office in Gogarburn, Edinburgh can now make payments by simply tapping their cards on a reader in a number of outlets on the Gogarburn site.

Munich, October 5, 2006–This summer, the Royal Bank of Scotland (RBS) began conducting a trial using dual interface EMV debit cards, the first financial institution in Europe to do so. The cards were supplied by Giesecke & Devrient (G&D), the world’s second largest smart card manufacturer. The project means that contactless payment cards, which are already a success in the USA, have now made their way to Europe. With their cards, the RBS staff users are able to pay small amounts by merely tapping them past a reader.

By conducting the field trial, RBS wishes to test convenience as well as user and retailer acceptance of contactless debit cards in Great Britain. Banking customers in the United States have been using contactless chip cards for quite some time now, preferentially for what is referred to as low-value payments (micropayments). RBS, MasterCard and G&D, working in close cooperation, have now brought a dual interface EMV product powered by MasterCard’s PayPass® technology to the UK market, and expect to see solid growth in this sector over the next three years.

By introducing a contactless debit card, RBS hopes to see people take to using their cards more often, instead of cash, for low-value transactions, thus reducing the amount of cash in the system, and speeding up payment at point of sale. The dual interface cards being supplied by G&D are not only able to communicate with card readers over the air, but they can also transfer data conventionally via the contacts on the EMV chip if the transaction value is high or where no contactless reader is available. This ensures payment can be made at the point of sale no matter what.

As a signature or PIN is not required for most small purchases, transactions can be carried out rapidly, reducing queuing time. The card only authorizes payment if certain conditions are met. If not, it then requires a contact-based online transaction with PIN input. This procedure, a key driver behind dual interface EMV cards, prevents the card from being abused for high-value payments in the event the card is lost or stolen.

During the trial, RBS employees are using the cards to make purchases worth up to 10 British pounds on the Bank’s premises in Gogarburn, near Edinburgh. The RBS facilities are ideal for the trial since they contain a range of outlets where the cards can be used, which together represent a miniature version of the “real” shopping world.

“We have been in successful partnership with RBS for many years now. That’s why we are especially pleased to have been chosen as the contactless card supplier for this technologically innovative trial being conducted in the UK. Thanks to our extensive experience with contactless technology, we are confident of our ability to provide RBS with all the support it needs,” says Michael Kuemmerle, G&D Group Executive for Cards and Services.

About Giesecke & Devrient

Giesecke & Devrient (G&D) is a technology leader in the field of smart cards, providing smart card based solutions for telecommunications, electronic payment, health care, ID, transportation, and IT security (PKI). G&D is also a leading producer of banknotes and security documents and is dominant in the field of currency automation. Based in Munich, Germany, the G&D group has subsidiaries and joint ventures around the world. In fiscal 2005, the Group employed some 7,500 people and generated revenue of €1.24 billion. For more information, please visit our Web site at http://www.gi-de.com.

About RBS

The Royal Bank of Scotland Group (“RBS Group”) is one of the world’s leading financial services companies. In 2000 RBS successfully completed the £21billion acquisition of NatWest, the biggest takeover in banking history. Since the acquisition RBS has continued to grow its business through the combination of strong organic growth and acquisitions. RBS Group now operates in Europe, the US and Asia Pacific serving more than 35 million customers world-wide and employing more than 140,000 people. In addition to the provision of a full range of banking services under The Royal Bank of Scotland and NatWest brands, RBS Group also includes Citizens Financial Group, Ulster Bank, Coutts Group, Direct Line and Churchill.