Amdahl Corp., a name that many electronics industry people associate with old mainframe computers, is diving headlong into the very new business of smart cards.

The Sunnyvale, Calif., company last week said it formed a smart card group to meet the transaction processing demands of electronic cash systems like Mondex.

Amdahl made its announcement a day after the official launch of Mondex International, the multibank venture spun off by Natwest Group of London to shepherd one of the more ambitious smart-card-based payment systems.

Last November, Amdahl said it would provide application systems, hardware, and consulting support for the worldwide implementation of Mondex.

"A lot of people talk about smart cards from the point of view of cards and terminals," said Michael Nash, vice president of marketing for the smart card group, who joined Amdahl last year after five years with Visa.

"But how do you process all the transactions when they come back to the bank? And how do you manage the interface with older legacy systems?"

Having recast itself as a provider of highly reliable transaction processing systems, related consulting, and integration services, Amdahl is offering a turnkey package that can put a bank immediately into a smart card program, and that can grow along with it.

"A company can roll our program out for a small system or nationally, and it is adaptable to any number of applications," Mr. Nash said. "A lot of people are promoting technology that operates on a small PC. We can operate on any scale."

He described the business opportunity as "enormous," the potential electronic cash market consisting of more than 20,000 banks and 10 million retailers worldwide.

In marketing initially to banks around the world - health care and other markets will come later - Mr. Nash did not see Amdahl's close association with Mondex as a problem, despite the controversies that have flared between the Natwest spinoff and MasterCard and Visa.

"Some of the differences between these approaches have been exaggerated, and they can be minimized with the right kinds of implementation," said Mr. Nash, who played a part in Visa's smart card developments.

Companies like Verifone and Gemplus support both Mondex and Visa, he pointed out. But he said Mondex alone, with its 17 owning banks, constitutes an attractive "critical mass."

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