New technologies recently introduced will help the acceptance of smart card based applications by consumers by offering an improved transaction platform and functionality that matches the improved functionality of smart cards, said payment technology expert George Wallner, chairman and chief technologist, Hypercom Corporation.
“Smart cards hold the promise of benefits for consumers and merchants worldwide. But that much-heralded promise won’t turn into widespread reality until the industry delivers new programs consumers genuinely value and also upgrades with new point-of-sale (POS) technology that makes the use of smart cards quicker, easier and more convenient than is the case today,” Wallner said.
With vastly greater information storage and processing capacity than conventional magnetic stripe-based cards, smart cards are finding applications by banks as advanced credit, debit and stored-value bank cards; by healthcare companies for medical and eligibility records and authorizations; by telephone companies for pre-paid services; by universities as all-purpose student ID cards; by governments for benefits programs; by retailers for customer loyalty programs; and by airlines for “frequent flyer” membership cards, among other uses.
Of the more than 2.5 billion cards worldwide used to activate some type of commercial or personal financial transaction, fewer than 99 million are smart cards. In contrast, there are more than 650 million conventional magnetic stripe-based credit and debit cards in the United States alone.
“For consumers and society to reap the benefits of smart cards, an infrastructure must be in place that can not only “read” the embedded microchips in the smart cards, but also support the kinds of new programs that consumers value and that help banks and retailers differentiate themselves with advertising, branding and loyalty programs,” Wallner said. “Advanced POS technology and value-added programs must go hand-in-hand for smart card use to grow worldwide.”
The current generation of point-of-sale terminals, even when equipped with a “reader” for smart cards, do not have the necessary features, such as easy-to-use touch-screen interfaces and portability, and do not support programs like merchant advertising and loyalty programs.
A featured speaker at the Cartes ’98 smart card symposium, Wallner noted successful POS devices in the future will not only “read” microchips, but as importantly will be easily used by consumers, feature faster times for purchase transactions and deliver advertising messages while purchases take place.
In addition to new card payment devices that are easily handled by consumers and support faster connections, the payments industry must also put in “smarter, more powerful” software, typically running on a high-performance server, to handle increased payment volumes, distinguish between payment types and support enhanced security and value-added services, Wallner noted.
Celebrating its 20th anniversary, Hypercom Corporation is a global provider of electronic payment solutions, including multi-functional point-of-sale terminals, peripherals, network products, transaction software, Internet-based and electronic commerce payment solutions. On a global basis Hypercom delivers the services and technology infrastructure required to quickly integrate and deploy new payment applications for competitive value-add programs, improved business performance and low total cost of ownership.
Headquartered in Phoenix, Arizona, Hypercom markets its products in more than 60 countries through a global network of offices and affiliates in Argentina, Australia, Brazil, Chile, China, Hong Kong, Hungary, Japan, Mexico, Russia, Singapore, the United Kingdom and Venezuela. Hypercom’s Internet address is [www.hypercom.com].