Several foreign countries are adopting the "electronic purse," employing what's known as open or multiuse stored-value systems for phone calls, laundries, and other transactions made with cash.
Executives from companies in Finland, England, and Denmark described their efforts at last week's AIC Conferences seminar in New York.
Pekka Mattila, development manager for Avant Finland Ltd., a subsidiary of the Bank of Finland, said its Avant card was launched in 1992.
The card is designed for transactions of less than $10. Originally a disposable product for public telephones, rechargeable Avant cards were introduced at the beginning of 1994.
The cards are now used for phones, parking, transportation, municipal services, and vending machines.
The Bank of Finland claims cumulative sales of close to 500,000 disposable and 10,000 rechargeable cards. Transactions are growing by 40% per quarter, the executive said.
Danmont A/S, a joint venture of Danish Payment Systems Ltd. and Copenhagen Telephone Co., launched a similar card in 1992. Danmont's co- owners represent all the banks and telephone companies in Denmark.
The cards are used for pay phones, parking meters, newspapers, public transportation, vending machines, and laundry, as well as in cafeterias, kiosks, and other places where consumers make low-ticket purchases. The average transaction is $1.
So far, 147,000 disposable cards have been sold, reaching 7.5% of the population.
In England, Mondex is nearing the first full-fledged test of its cash alternative. The pilot, taking place later this year in the town of Swindon, is intended to test the smart card system and prove it is a viable cash equivalent. Some of the biggest merchants in Britain have agreed to participate.
Tim Jones, a National Westminster Bank executive who heads its Mondex venture, made one of his frequent trips to the United States to demonstrate Mondex at the meeting last week.