PHOENIX -- Verifone Inc., the nation's leading supplier of merchant point of sale equipment, has introduced a pair of products designed to accommodate anticipated changes in consumer payment card usage.
At the Bank Administration Institute's retail delivery systems conference, the Redwood City, Calif.-based company unveiled a new screen phone and a smart card reader-writer.
The former is a third generation version of Verifone's smart phone products, which enable consumers to do home banking, electronic bill paying, and other transactions through an advanced phone.
The smart card device has been available in Europe for some time and is making its debut in the U.S. market in response to interest by large financial institutions in applications for cards with microcomputer chips.
"Point of sale is fast changing into point of service," said Michael Shade, director of marketing programs and planning for Verifone, meaning that card-based transactions are rapidly moving to areas beyond the traditional merchant locations.
The new products represent Verifone's recognition that each new venue for transactions needs a specially tailored system. With the new screen-based phone, known as Omni VuFone, Verifone is supporting transactions from the home.
The product combines elements of a personal computer, a point of sale terminal, and a phone to allow consumers to quickly conduct financial transactions without leaving their homes.
Verifone executives maintain screen-based phones are more convenient to use than personal computer-based home banking applications, which require users to boot up their systems and establish a modem connection before conducting transactions.
In addition, proponents of screen phone applications have long stated that consumer familiarity with phones gives screen phones an entree that computers cannot match.
While few would argue that consumers on average are currently more comfortable with phones than with computers, many still believe that the future of sophisticated home banking lies with personal computers, which are fast becoming household items. Others maintain that as home banking matures it will include a mixture of delivery mechanisms that include phones, computers, and televisions.
As screen-based phones go, Omni VuFone is sophisticated, experts said. It features a four-line screen, a magnetic stripe card reader, and a phone keypad that folds away to reveal a keyboard for use in complex transactions. The phone prompts users through transactions using menus patterned after those found on automated teller machines.
Other features include advanced telephone functions such as a two-way speaker phone capability, a dialing directory, and a phone log for tracking calls. Several financial institutions have teamed up with local phone companies in an effort to use these functions as a marketing tool for the screen phones.
Verifone will begin shipping Omni VuFone later this month to select customers. The product will be generally available in the first quarter.
Meanwhile, the company's smart card reader-writer, known as the SC 450, is ready for immediate shipment. The hand-held terminals have been in use overseas for two years, and company executives believe the time is right to market the product here.
Verifone's closest competitor, privately-held Hypercom Inc. of Phoenix, also unveiled its smart card reader, the S7SC, which accommodates both chip cards and traditional magnetic stripe cards and is compatible with the T-series point of sale terminals including the recently released T7P.
The SC 450, like the Hypercom device, is designed to act a bridge between magnetic stripe cards and smart cards. Frequently mentioned uses for the cards include health care and prepaid applications, in which the card's computer chip is loaded with electronic cash.
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