LONDON -- Despite widespread resistance from the financial industry, Royal Bank of Scotland is to become the first in Britain to put customers' photographs on bank cards -- to thwart crime.
The Edinburgh-based banking company is launching a pilot program this week among 30,000 customers to test the usefulness of laser-engraved photos and signatures.
The $56 billion-asset Royal Bank, Britain's seventh-largest, also owns Citizens Financial Group Inc. of Providence, R.I.
Other British banks have resisted police and government calls to introduce photo-embossed cards, even though plastic fraud and theft cost the industry an estimated $250 million annually.
Resistance from Association
Despite the urgings of senior government officials at a recent meeting, an industry body, the Association of Payment Clearing Services, has not endorsed the modified cards.
The association is not convinced that retailers would look at the photographs or that the cards would be acceptable to customers, a spokesman said.
In Britain, where about 60 million plastic cards are in circulation, the cost could also prove prohibitive, amounting to as much as $175 million, the spokesman said.
At Royal Bank, Andrew Waldman, head of card services, stressed that his bank's scheme is not a "government-controlled" project.
Reasons for Testing
"I can't speak for other banks, but the simple fact is that -- although the industry is doubtful -- nobody's ever tried photocards to see what customer and retailer reactions would really be," Mr. Waldman said.
"We are convinced that this action will cut down fraud, 30% of which at our bank is caused by [theft in the postal system] before the card we issue get to the customer," he said.
The trial will be introduced for the 900,000 users of Royal Bank's Highline card, for check guarantees, cash dispensers, and debits.
Cardholders in 10 cities will be sent special forms asking for photographs and signatures to produce the new cards. These images will be burnt into the plastic by laser. "The faces and signatures cannot be replaced, amended, or removed, and will provide the customer with a high degree of security," Mr. Waldman said.
The trial will not include Royal Bank's Visa and MasterCard cardholders, at this stage, Mr. Waldman said. "We do all our processing in-house for Highline, so we can closely monitor the project, including administration costs," he explained.
If initial tests are successful, the project would be extended to Royal Bank's credit cards, held by about 3.5 million customers.
"There is plenty of room on Visa and MasterCard plastic to insert photographs," he said. "On these blank parts of the cards, we feel we can do as we like."
Royal Bank plans to make a "small charge" to customers in return for what it characterizes as the added security offered by the new cards.