We're getting there...
Tuesday September 12, 4:15 pm Eastern Time
Visa launches smart card system for bank issuers
NEW YORK, Sept 12 (Reuters) - Top credit card network Visa U.S.A. on Tuesday launched a technology system for credit cards embedded with computer chips, in a major push to bring the cards to a U.S. market that so far has been unreceptive.
The platform would provide banks that belong to the Visa network with applications to issue so-called ``smart'' Visa cards, which contain computer chips that store data.
But the cards have had a checkered history to date in the United States.
They are very popular in Europe but an attempt to bring them in New York City in 1998 failed, partly because of intense competition from credit cards and other payment options available to Americans.
Smart cards also need to be put through a special reader to work, which has been another obstacle to their growth.
But the growth of online shopping has put the spotlight on smart cards again, as a way to protect cardholder account information from being stolen while browsing the Web.
``Over the past five years, the evolution of the Internet and the impact of electronic commerce has generated an increased demand in the United States for payment products offering enhanced technology and applications,'' said Al Banisch, senior vice president of consumer credit cards, Visa
U.S.a.
In the latest effort, Bank One Corp.'s (NYSE:ONE - news) First USA credit card arm, Boston-based bank FleetBoston Financial Corp. (NYSE:FBF - news) and credit card company Providian Financial Corp. (NYSE:PVN - news) will bring out Visa smart cards this autumn.
Providian's card is clear plastic and contains a computer chip that it said eventually could serve as a telephone calling card or an electronic ticket, not just as a cash card. It also has a magnetic stripe so it can be used in stores.
``It will be like having a computer in your wallet,'' David Alvarez, head of integrated card business for Providian, said. ``Over time, we hope to have this card work with cell phones, Internet TVs, hand-held organisers and personal computers...''
Visa, which is owned by major banks, said it was in talks with other bank members about using the new technology.
Used with special readers connected to a computer, cardholders ultimately would be able to download services to enhance their card without getting a new card, Visa said.
To market the card, Visa said it will advertise on television and the Web, and also run promotions. |
