Pinnacle Is Enlisting In The New Smart-Card Revolution
Jun. 13, 2000 (Computer Reseller News - CMP via COMTEX) -- New York - Pinnacle
Business Management Inc. is joining the smart-card revolution.
With the help of SmartNexus Inc., a Los Angeles-based solution provider,
Pinnacle will be phasing out its debit cards in favor of chip-based technology.
Pinnacle, which advances small loans to customers before payday, currently uses
a private-label solution to issue debit cards that consumers can use at an ATM
or point of sale, said Bruce Hall, president of Pinnacle, Clearwater, Fla. The
SmartNexus solution deploys Visa-branded cards with an onboard chip, he said.
"The [payday loan] industry is clearly going toward cards with a brain vs.
pieces of plastic with just a magnetic stripe and a name embossed on them," said
Hall. "Smart cards leave a lot more room for growth-for us, our customers and
the card suppliers."
Smart cards also allow for more secure, less costly transactions, for loyalty
programs that benefit consumers and merchants alike and for electronic cash
applications, said Cynthia Abbott, president of SmartNexus.
"The magnetic stripe on debit cards is easily counterfeited. But a smart-card
chip is essentially a computer. It scrambles the information so it's difficult
to retrieve," Abbott said. "These chips up the ante for counterfeiters."
And because smart cards allow for self-contained transactions,
telecommunications charges tied to transmitting data from magnetic stripes are
eliminated.
Merchants can capitalize on smart cards with loyalty programs that draw
customers back to their stores for special sales and promotions, said Abbott.
That way, consumers get to save money, and proprietors get repeat business, she
said.
In July, Pinnacle customers will receive "instant issue" cards for ATM and POS
use. Customers can then upgrade to "full-service" smart cards at kiosks or
online at the SmartNexus Web site.
SmartNexus will be integrating the products and services of four third-party
partners to deliver Pinnacle's turnkey smart-card solution, said Abbott.
For Pinnacle, the SmartNexus solution will pave the way to an expanded business
model. The loan company, currently operating in the Southeast United States,
plans to cover all regions of the country within the next 12 months.
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