Two of the biggest credit card providers have announced new cards based on chip and Pin and radio frequency identification...
At this week's Cartes 2004 conference in Paris, which showcases the latest card technology, Visa announced plans to issue a chip card that complies with the EMV (Europay MasterCard Visa) technical specification for the next generation of debit and credit cards.
Like the chip cards that are currently being rolled out in the UK the Visa "mini chip" card allows cardholders to pay for transactions by entering a four-digit Pin code into a terminal instead of signing a receipt.
Visa also said that it would widen a pilot of a service to verify the identity of card holders paying for goods online.
The service, called Verified for Visa, generates a one-off password for the card holder for each online transaction. The card owner inserts their card into a card reader, which verifies their identity by exchanging information with the card providers IT, systems.
Meanwhile, MasterCard announced a chip card that incorporates RFID technology to allow for "contactless" payments like the Oyster smartcard used on the London underground train network.
The card has RFID technology embedded into the card, which interacts with a terminal. The payment is then cleared in the same way as a normal transaction.
MasterCard said the first cards and terminals are ready for testing by banks and merchants.
"OneSMART PayPass combines the power and security of MasterCard M/Chip, with the speed and convenience of contactless payments," said Pascal Dufour, vice-president and head of Chip Product Management, MasterCard International.
"Contactless payments are most powerful in places where speed is of the essence - such as in quick-serve restaurants, petrol stations and tollways. Cardholders simply tap their PayPass-enabled card on the PayPass reader and are on their way."
Talking to Computer Weekly, Toni Merschen, senior vice-president for MasterCard, admitted that smartcards had taken more than 20 years to get near widespread use, despite being tipped as a replacement for cash. But he added that chip and Pin and contactless payment technologies were now well-tested and could offer businesses substantial benefits through reduced costs and improved customer service.
Merschen said that the rolling out of chip and Pin technology in the UK made it an ideal test bed for developing new applications within smartcards, such as customer loyalty schemes.