MasterCard Inc. says its deal with a soft drink bottler will lead to the nation's largest rollout of contactless technology in the vending and point of sale markets, 6,000 vending machines.
The Purchase, N.Y., company said Tuesday that Great Plains Coca-Cola Bottling Co. of Oklahoma City is the third major U.S. bottling company to adopt the PayPass contactless technology it is marketing in conjunction with USA Technologies Inc., the Malvern, Pa., maker of a card reader that fits into the bill slot on vending machines. Related Links
T.J. Sharkey, group head of national accounts in MasterCard's U.S. commerce development unit, said vending machines that accept cards are producing 32% more revenue for snack distributors than those that do not. "They can put in a higher-cost energy drink, which consumers want and which generates more income for the bottler."
MasterCard said the companies are deploying the technology in more than a dozen U.S. cities.
Most machines use a cellular Internet connection to authorize transactions (though they can also use Wi-Fi), Mr. Sharkey said, and the speed of processing is one of the key selling points for contactless. "You don't want to wait for dial-up."
Steve Herbert, the president and chief operating officer of USA Technologies, said that the technology enables automated reporting to the vending machines' owners.
Mr. Sharkey said Great Plains has begun deploying the card-enabled machines in Oklahoma City and Tulsa.
Dan Schatt, a senior analyst in the retail banking group at Celent LLC, said such machines could rival quick-service restaurants as a place to use cards.
"The vending machine industry has been sort of overlooked as a tremendous venue for contactless," Mr. Schatt said.
Card payments also can be more secure than cash for the machines' owners, he said. "They would like to see the cash volume lessened and the card volume grow."
