BRUSSELS/NEW YORK — American Express has bought a global license to
use a Belgian company's chip technology in the smart card systems it has under
development through a series of pilot programs.
Specifically it has put Banksys' proton technology to work as an “electronic
purse” in a year long-test with about 2,000 marines in Jacksonville, NC.
The Belgian chip, Banksys commercial director Armand Linkens explained, “puts
much more functionality on the chip card.” Proton's advantage lies in payment
applications for small sums.
“You load cash in small denominations on the chip card and use the card to pay
for small items like hamburgers. It is much faster than cash. It gives you exact
change all the time. It is cleaner than cash. Cash can be quite dirty.”
The chip card also offers merchants greater security, Linkens said, because they
need to keep less and perhaps no cash in their drawers, thus protecting them
from theft or holdups.
Special terminals deduct purchases from the card, making customer movement
out of the store much faster as well, Linkens said.
The AmEx test allows marines to activate the e-purse and “load personal funds
from their Marine Federal Credit Union account,” Amex spokesperson Molly
“They can then use the smart card to make purchases at popular locations on
base, including the Officer's Club, bowling alley, barber shop and vending
machines and can reload funds as needed into the e-purse.”
The test began late last year and is scheduled to run for a year. It is one of several
American Express is running to find the mix of technologies that will make the
chip card more useful to card holders.
Other pilot tests with Continental and American Airlines are using smart cards for
faster airport check-in and access to VIP lounges. It also allows quicker check in
and check out at eight Hilton hotels participating in the test.
Europeans, Linkens argued, may be ahead of the US in application of smart card
technology which is already more widely used than in the US. In fact, however,
applications are most widespread in the Benelux countries.
The Netherlands, for example, has a wide array of bill-paying applications that
can be handled with smart cards. Introduction of the Euro at the end of next year,
experts predict, is likely to increase smart card use.
The Euro and national currencies will co-exist for three years, a period likely to
bring a fair amount of confusion to the payment of small bills to local merchants.
The question is, these experts said, is how quickly the necessary scanning
machinery can be installed in local shops. They also noted, however, that more
extensive US testing is likely to come up with a better performing product.
And they pointed to the French minitel as an example. The small computer
installed in millions of French homes as an advanced telephone book has been
overtaken by more modern technology and helped put France at a disadvantage
in the high tech race.