Air Travel Card, the business travel program sponsored by major airline companies, is stepping up to SET.

The Washington-based card program, an outgrowth of the Air Transport Association, announced an agreement to buy technology from Verifone Inc. to handle payments over the Internet.

Verifone, the transaction automation subsidiary of Hewlett-Packard Co., will supply its vPOS and vWallet software, which complies with the MasterCard-Visa Secure Electronic Transaction Standard.

Air Travel Card, which announced an electronic commerce pilot last summer, when SET was in test mode, joins other major card brands in supporting the security specification. Besides MasterCard and Visa, they include American Express, Discover, and JCB of Japan.

"This accord sets the stage for Air Travel Card's electronic commerce program," said Charles Fischer, the organization's managing director. "It will allow the world's airlines to accept the Air Travel Card as payment in an extremely secure environment."

The airline group said in its July 1997 announcement that it intended to lead the travel industry into secure electronic commerce. It contracted with Verisign Inc. of Mountain View, Calif., which this year entered into a formal marketing alliance with Verifone, to provide the digital certificate service for cardholder authentication.

Four of Air Travel Card's 28 issuing members-200 airlines accept the card overall-participated in the pilot: American, Lufthansa, Swissair, and United.

Through the agreement with Santa Clara, Calif.-based Verifone, Air Travel Card will supply the vPOS on-line card acceptance system to American and Lufthansa. These airlines, in turn, are to conduct pilot tests with their subscribers, who will be given the vWallet software for initiating payments at a personal computer.

At each point in the transaction, the Verifone software provides the necessary data encryption and authentication for authorizing transactions free of hacker attack or intrusion.

SET has taken off more slowly than advocates had hoped, though they say the system is in many ways more secure than conventional credit card payments. The crux of the procedure is digital certification; merchants do not see the cardholder's credit card number.

Verifone, like several of its competitors, has been aggressively promoting SET, and the Air Travel arrangement is no exception. In their program's second phase, the companies will be offering incentives for other airlines to accept virtual card payments. These will include discounts on software plus "end-to-end testing with specially trained personnel and turnkey operations," Mr. Fischer said.

"It is Air Travel Card's aim to make its electronic commerce program accessible to more than 200 airlines," he added.

In a separate announcement Tuesday, Verifone said the electronic commerce software company Intershop Communications Inc. had integrated vPOS with its Intershop 3 system.

For Intershop customers using the Microsoft Windows NT operating system, vPOS is an SET-based plug-in that widens the payment options available to merchants and consumers. Intershop, based in San Francisco and claiming to support 25 payment systems worldwide, is one of numerous commerce-enabling companies Verifone has worked with. It has alliance deals with Microsoft Corp., Oracle Corp., iCat Corp., and Open Market Inc., among others.

"It is exciting to see market leaders like Intershop and Verifone working together to deliver SET solutions," said Steve Herz, senior vice president of Internet commerce, Visa International.

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