Electronic commerce has put Ennis, a town of 17,000 people in County Clare, Ireland, on the map.

Ennis is Ireland's Information Age Town, a designation it won over 49 entrants from all over the country. By winning top honors, Ennis secured investments of $20 million over three years from Telecom Eireann, the state-run telephone company, which is using Ennis as a high-technology showcase and test bed.

Telecom Eireann has committed to supplying 5,600 households with free voice mail, personal computers, and Internet access, and every business with high-speed ISDN lines. And it is collaborating with the two biggest Irish banks in the country's first smart card trial.

"We hoped to find out how communities could change with new technologies and how consumers would react," said Fiona Tierney, head of cards and pay phone services at Telecom Eireann in Dublin. "We have to allow people to develop a familiarity with the technology."

Bank of Ireland and Allied Irish Bank-which together have more than an 80% share of the country's banking market-have teamed up with the telephone company to enable people to use Visa Cash cards in cell phones, screen phones, personal computers, public phones, parking meters, and vending machines.

Besides retail stores, taxicabs and pubs also have been equipped with portable chip card devices. The banks deployed 20 stand-alone cash-loading stations in parking lots, shopping centers, and bank branches.

Together with Hewlett-Packard Co.'s Verifone subsidiary and Telecom Eireann, the banks are beginning to deliver smart card services to consumers' homes.

The two banks have completed implementation of Verifone's Verismart software. It is the first time this has been done by a telecommunications company for hosting financial institution smart card services.

Verismart, developed two years ago and often associated with a hand-held smart card device called Personal ATM, "is an open and flexible middleware architecture that integrates into the telco network, hosts multiple applications, and talks to different smart card devices," said Julie Lins, director of smart card solutions at Santa Clara, Calif.-based Verifone.

"This is our first implementation in Ireland," she said, "and the first combination of a telco with a financial institution, a model we think will be successful elsewhere." Verifone has sold other Verismart licenses to Sparbanken in Sweden and to companies in Taiwan, Japan, and the United States.

Cooperating with other companies can benefit banks economically, she said. "Financial institutions have played with smart cards for years but found the cost of infrastructure was a barrier to entry."

The trial in Ennis has shown there was a need for more convenient, lower-cost methods of loading value onto cards from home or with mobile phones, said Telecom's Ms. Tierney. "We have confirmed the high cost of deployment of a load infrastructure, which reinforces the case for the cooperation of the banks and the telco."

Over time, Telecom Eireann plans to distribute Verifone Personal ATMs to 500 consumers in Ennis, with the first 90 going out this month.

By connecting Personal ATMs to Telecom Eireann's server computers over phone lines, consumers can check their Visa Cash card balances and load value onto their cards. The Personal ATM hooks directly into the phone line.

The Verifone server system can recognize whether the person is using an Allied Irish Bank or Bank of Ireland smart card, and can connect the person to his bank account.

"This is a first for us," Ms. Tierney said. "We're in the business of building an infrastructure for smart card services, not just for financial services. We want to see how consumers adapt to home-banking by getting used to using their smart cards in the home."

When the simple prepaid smart card was introduced last November, it was offered to customers of the two banks. The eligible Ennis residents had to apply for the card and then call to the local branch to collect and personalize it.

The card is linked to a person's ATM-current (or checking) account, and the same PIN-personal identification number-access method has been adopted. At the branch, bank staff demonstrate how to load value on the card before the customer leaves with a smart card. A maximum of $65 can be loaded.

"Our aim was to test the target market for small-value purchases as an alternative to cash, but not to displace it totally," said Frank Doherty, Allied Irish Bank's project manager. The real value for a smart card such as this, he said, is self-service.

Marketing on one local radio station and in one local newspaper reached the target audience effectively. Bank customers were sent a letter encouraging them to take up the offer, and the banks also had a van tour the town and advertise the trial.

"The reaction has been mixed," Mr. Doherty said. "Some think it's a good idea. Some don't like it at all."

The trial marks the Irish banks' first foray into smart card technology. "We wanted to test the product from a consumer point of view to see if there was a need, how they were prepared to use it, and where they would use it," said Colette Real, Bank of Ireland's program manager. "We also needed to see if the retailers used it and whether it was a viable commercial proposition for us to move forward.

"Ultimately, we see all magnetic stripe cards moving to chip," she said.

The banks have distributed 3,000 cards, and 250 retailers-about 90% of those in Ennis-have signed up, Mr. Doherty said. About half the retailers already had debit and credit card terminals in their stores; now they have additional smart card terminals that operate off-line.

Those who already had point of sale terminals, he said, adapted quicker than others to the new technology.

Using a free phone number, retailers periodically dial in their smart card transactions to Visa International in the United Kingdom, which does the back-end accounting and processing.

Mr. Doherty said card use has been strong at gas stations, where the card is typically used to make convenience store purchases in addition to fuel, and at express checkouts in supermarkets.

Unattended devices such as the 12 parking and 30 pay phone locations are also doing well. This month, 22 Coca-Cola vending machines with smart card compatibility are being deployed in local high schools.

The trial was always intended for research and development, Mr. Doherty said, and "the multimillion-pound project has worked out several times more expensive than we had originally planned."

Initially, Mr. Doherty said, the Irish companies hoped to piggyback on a smart card trial in Leeds, England, where six financial institutions have been involved since October 1997. When that did not pan out, the organizers sought a way to put their technology in place and learn about consumers and retailers in Ireland.

"We have gone with extra functionality over and above Leeds, for example, the home-loading function," Ms. Real said.

Both bank executives declined to reveal transaction figures to date. Mr. Doherty said: "It's a trial. We expect things not to work."

They have set a limit of 10,000 cards, and the trial is scheduled to end in November.

"We've made a commitment to keep the trial running for a year," Ms. Real said. "We'll evaluate it before November and decide whether to complete or continue it."

She added that rather than running a closed, proprietary system, "we wanted to go with an open scheme where any bank could issue cards and any service provider could join."

Visa Cash was chosen over, say, Mondex or Proton, Ms. Real said, because "we always wanted a scheme that was a pathway to an international scheme. Visa is at the forefront of trying to influence interoperability of chip cards.

"Visa is also a very major brand, and we thought the strength of the brand would help in launching the product itself," she added.

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