Smart plastic vies for attention

By IRENE CHAPPLE

Almost a decade ago smartcards were held aloft as the way of the future.

With embedded computer chips, credit cards would not only pay for goods but track loyalty programmes and discount coupons.

A smartcard would be the only plastic required in your wallet, remember?

Yet still New Zealand has not adopted the technology and still, admits Shuan Ghaidan, Mastercard's Asia/Pacific vice-president and regional head of advanced payment systems, they are talked about as a solution looking for a problem.

At this week's Asian Retailers Conference in Christchurch, delegates received smartcards on registration.

Their use at a conference is believed to be a first for New Zealand.

They hold information on each delegate and ensure translation headsets - available for loan but which cost about US$200 ($337) - are tracked and returned on departure.

And, as a promotion for the technology, delegates received predetermined gifts - a pen, for example - after plugging their smartcards into the Mastercard exhibition booth's computer.

Ghaidan is upfront about limitations on the smartcard's uptake.

His presentation to a couple of hundred conference attendees briefed them on awareness of smartcard technology among retailers, on average just under 50 per cent, and satisfaction with existing magnetic strip technology, at 63 per cent.

Cardholders are cautious about the technology, saying they wanted it to help them organise their lives but wanted to control how information on the smartcard would be used.

But use of smartcards may reduce credit card fraud, increase efficiencies and save the retailer money.

Retailers can also benefit from the immediate collection of customer data.

Costs of buying a card have plunged from US$12 to around US$1.99 and the long-term potential of smartcards, said Ghaidan, was limitless.

So why has the world been so slow to adopt smartcards?

Ghaidan said the business case had been hard to make.

While smartcards were tipped as the new thing in the mid-90s, it has taken until now for the technology to be affordable and easily adapted.

In New Zealand for example, many retailers own their credit card facilities and the manufacturing of smartcard-capable machines has only just started.

It may take some years for retailers to replace their Eftpos machines with smartcard-capable technology.

However the industry is pushing to have all Eftpos machines smartcard-capable by 2006.

Ghaidan has been working with smartcards since 1998 and says back then he expected 10 per cent of the Asia Pacific's Mastercard market to have adopted the technology within a couple of years.

Although slow coming, smartcards were now "beyond the point of no return".

When asked to empty his pockets of plastic, he was carrying 13 plastic cards. "In my defence, I work for Mastercard," he said. "This is what will happen.

"Everyone else will carry one card and I will have 13."