An AT&T Corp. unit has formed an alliance with Girovend Holdings Ltd. to promote smart cards as an alternative to cash.

The companies said they would concentrate initially on the U.S. education market, then seek health care, banking, retailing, and other opportunities worldwide.

AT&T Smart Cards, based in Somerset, N.J., will contribute its contactless technology, which allows a card's data to be read even if it is not inserted in a terminal.

Girovend, a British company that recently merged with Debitek of Chattanooga, Tenn., is a leader in cashless vending and payment systems. Users include the British Mint, European Commission, the Citibank unit of Citicorp, and Coca-Cola Co.

AT&T and Girovend said that, together, they have the technology and expertise to profit from cards' displacing cash.

Their agreement will be co-managed by William C. Cook, Girovend's director of planning, and Jack Doering, director of applications marketing for AT&T Smart Cards.

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