over the next three years to replace its 21.5 million magnetic stripe cards in Brazil with chip cards.

In the first phase, which began in August, Visa is replacing more than 150,000 cards in Campinas, Sao Paulo state, where it has been running a smart card pilot test since 1996. It will begin replacing cards nationwide in January and expects to have 10.2 million credit cards and 11.3 million debit cards replaced by January 2002.

More than 70% of VisaNet's 110,000 merchant terminals in Brazil are equipped to read smart cards, the association said. The rest are expected to be ready to do so by the first half of 2000.

Visa do Brasil, the VisaNet merchant processor, and 13 member banks, will foot the bill. The banks include Bradesco, Banco do Brasil, Unibanco, Banespa, Safra, Lloyds Bank, HSBC, Caixa Economica Federal, Credicard, Banestado, Bandeirantes, Real, and BankBoston.

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