MIAMI - Stymied in previous efforts to coax U.S. banks to accept smart cards, Visa International is using its market heft to induce price breaks for banks that agree to convert their magnetic stripe card portfolios.

The move comes a year after American Express Co. enjoyed a marketing coup with Blue, a hybrid card whose launch was so successful that the company struggled to produce cards quickly enough to meet demand. Perhaps stung by that move, Visa is now applying its massive market reach and a renewed commitment to the effort.

Debbie Arnold, vice president of chip, credit, and debit products at Visa, said that she has seen increased interest in smart cards lately, and that Visa's pricing program is a way to "kick-start the market."

"The timing is right," Ms. Arnold said. "Now that Y2K has passed, people are ready to start implementing chip card programs."

The sheer cost of producing chip cards - about $4 per card versus about $1 for conventional cards - is perhaps the biggest reason banks have been slow to introduce them. To offset that Visa is busy signing deals with smart card vendors, which are volunteering to give 50% to 70% discounts to the early bank adopters. Visa named the first three participating companies yesterday and said it will have dozens of similar deals in place by July.

For now, since few if any U.S. merchants can accept chip card payments, the Blue card's chip works only as an authentication device for Internet transactions, but American Express anticipates it will soon become a useful device in many real-world settings.

Visa will do joint marketing with the vendors in the program, but the companies themselves will provide the subsidies. The three that have signed up are ACI Worldwide and IFS International Inc., which provide host systems for smart card programs, and NBS Technologies Inc, a card personalization vendor.

IFS, of Troy, N.Y., is offering 50% off to the first 100 banks that sign up for its "e-chip program," which includes everything needed to migrate to chip, from planning and consulting to software. ACI, of Omaha, will give a 50% to 70% discount to the first 24 banks that sign contracts in the next two years. NBS, of Toronto, said it will halve the cost of a typical Visa smart card personalization program for an undisclosed number of early customers.

Visa said it is negotiating similar terms with about 30 global vendors that offer all the puzzle pieces necessary to implement an entire smart card system: the major chip card manufacturers, point of sale terminal and automated teller machine vendors, and other software and system providers.

Visa said that additional contracts are expected to be signed in Miami this week at CardTech/SecurTech, the largest annual conference on card and security technology, and that all the contracts are expected to be in place within two months.

"The move from the mag stripe to chip requires a substantial investment on the part of Visa member banks," said Gaylon Howe, senior vice president of consumer products at Visa.

MasterCard International said it is also exploring incentives for smart card adoption.

Specifically, it is looking at cutting costs for merchant terminals and shifting some liability away from merchants who accept smart cards.

"These guys are starting to recognize they've got to provide a catalyst, and that's money," said Jerome Svigals, a smart card consultant in Redwood City, Calif.

Mario Di Prizio, director of engineering and product development at Motorola's smart cards division, said Visa was making a "bold move."

"They've acknowledged the No. 2 roadblock" to chip adoption and now are "subsidizing the infrastructure," Mr. Di Prizio said.

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