Consumers are so interested in smart cards that they'd switch banks to get one, according to a consumer survey conducted by MasterCard International.
The survey queried 2,000 consumers in 23 U.S. cities and four cities in Australia, and found that 60% of Americans and 55% of Australians would rather replace their bank than go without the new payment method.
MasterCard's research also discovered a "striking similarity" in results from the two geographical groups, "supporting our interest to apply the pilot results from Australia to the U.S. and beyond," the card association said.
MasterCard will conduct a smart card pilot in Canberra, Australia, beginning in the fourth quarter of this year.
"The pilot is going to represent the core functionality of our commercial and production system," said Walter Greenberg, vice president, chip card business, MasterCard. "This is basically Phase One of our stored- value solution." Mr. Greenberg said the system will be used for subsequent pilots in other parts of world.
He said the main objective of the research is to give a broader picture of consumers' feelings and perceptions of products. "To really get viable information for marketing plans, branding, and pricing, you have to do concept testing and quantifiable research."
Consumers were interviewed by telephone and about half were paid to come to a location and watch a video presentation of stored-value cards in application.
The survey found that half of Americans and 55% of Australians expressed interest in stored-value cards.
When given the choice, 84% of Americans and 76% of Australians prefer a stored-value application combined with automated teller machine/debit cards rather than a separate card for stored value.
In both countries, the top three locations to use stored value cards were gas stations, supermarkets, and convenience stores. More than 50% of Americans and 46% of Australians said they'd prefer to load value onto cards at an ATM. Another top location was at point of sale terminals.
Americans said they would carry a minimum of $100 to a maximum of $300 on cards, while Australians would carry $50 to $250.
"Our research found that the unbanked and lower income populations are more excited about smart cards," said Tom Murphy, vice president Global Concepts Inc., an Atlanta-based payment systems consulting firm, who did the survey for MasterCard.
"They're not going to put that kind of money on cards. This research didn't focus on them."
Though most consumer research done by the banking industry indicates that consumers want stored-value cards with added functions like debit or credit, a Seattle Metro Transit study found that more than 50% of consumers would prefer a standalone card for their transit needs to avoid the temptation of spending too much.