The fast food counter will be the latest place to accept plastic with the roll-out of a program that enables the Subway chain to take low- ticket transactions using credit, debit or relationship cards at as many as 2,000 of its franchises. Though the program seems a prime target for smart card use, the parties say they didn't even consider chip technology.

Smoky Mountain Technologies (SMT), a subsidiary of Unicomp, has teamed with First Tennessee National Corp. to enable card-based transactions at Subway stores using SMT's StoreKare for Subway point-of-sale (POS) software.

Subway will be the first fast-food chain to accept credit and debit cards on a widespread basis when the program is beta tested in late July. "It's like a balloon waiting to pop," says Harry Hargens, vp of sales and marketing at SMT. "One of the majors like McDonalds or Burger King or Wendy's will make a decision, 'Yes, we're going to do this,' and then there'll be a stampede."

The relationship card will help drive target marketing programs, with Subway culling age, income, family size and zip code statistics when customers sign up. Though Subway corporate hasn't yet approved an official roll-out, Hargens says the detailed sales reports generated with the data will be invaluable. Individual franchises will have the option of creating magnetic stripe relationship cards or using paper cards with a number that can be manually entered into the POS reader at each store.

And though many have predicted that smart cards would be the answer to merchants' and financial services companies' desire for relationship strategies, Hargens says the instrument was too expensive to consider. Says Steve Demaree, svp of First Tennessee Merchant Services division, "We aren't waiting for the chip card. Until we can economically bring the chip card to the merchant community, we're going to utilize what we have available to us."--sausner

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