Wells Fargo & Co. and Chase Manhattan Corp. head a group of seven U.S. companies making equity investments in the Mondex smart card system.

Wells and Chase - through subsidiaries Wells Fargo Bank and Texas Commerce Bank - have acquired 30% and 20%, respectively, of Mondex USA, the global payment organization's U.S. franchise.

They will be joined by five 10% owners in a formal announcement today of the launching of Mondex USA. It will be based in San Francisco, with Wells Fargo executive Janet Hartung Crane as president and chief executive officer.

"We have an impressive group of well-capitalized players who are making very significant, long-term commitments," Ms. Crane said in an interview Wednesday.

She said her unit would begin in earnest to staff up in January - it has heretofore relied on about 15 Wells people led by Ms. Crane and executive vice president Dudley Nigg - to "propel Mondex in the United States."

Along with Wells and Texas Commerce, two other national banks - subsidiaries of First Chicago NBD Corp. and Michigan National Corp. - got approval this week from the Office of the Comptroller of the Currency to participate in Mondex USA.

Also owning 10% each will be three nonbanks that did not require OCC clearance: Dean Witter, Discover & Co.; AT&T Corp.'s Universal Card Services unit; and MasterCard International Inc.

Only Wells and AT&T were previously listed as Mondex owners. They and Natwest Group, the London banking company that developed Mondex, were the first equity participants in Mondex USA and were among the 17 "global founders" of the Mondex International umbrella organization incorporated in July.

Wells and AT&T "sold down" their interests to accommodate the five additional partners, Ms. Crane said. And Natwest Group completely sold what was designed to be a temporary, minority stake.

Meanwhile, Mondex International is in a state of flux, awaiting MasterCard's purchase of a 51% interest, leaving the U.S. company, Mondex UK, and other regional entities with pieces of the remaining 49%.

The U.S. owners did not disclose the value of their equity stakes. It has been publicly acknowledged only that the original capitalization of Mondex USA was 30 million British pounds, or about $50 million.

That is likely to be a fraction of the marketing and development expenditures required to realize Mondex's vision of "global electronic cash."

"This is something that is definitely not going to be a smashing success in one year," Ms. Crane said.

But given Mondex's blue-chip backing and the owners' desire to sign others as card issuers, merchant-acquirers, and licensees, Ms. Crane said she has every reason to be confident.

As evidence that momentum is already building, she cited growing trials in Britain and Canada, the rapid sign-up of 12,000 cardholders for a test in Hong Kong, and commitments from technology vendors like Verifone Inc. to create the necessary infrastructure.

Infrastructure-building and pilot testing are the Mondex USA priorities for 1997, the CEO said. Wells has 800 employees using the chip cards at 22 merchants; AT&T just launched a 200-employee test in Jacksonville, Fla., and is planning to handle "virtual" transactions via the Internet and intranets.

The last will demonstrate Mondex's ability to operate in both the physical and virtual worlds, which Ms. Crane said gives Mondex a unique advantage.

An eagerly awaited New York City trial - the first attempt by MasterCard and Visa to prove their competing technologies can "interoperate" - has been put off from the first to the fourth quarter next year, in part to let MasterCard implement the Mondex system.

Each of the Mondex USA owners has a seat on the board of directors, with Mr. Nigg of Wells as chairman. Ms. Crane, who joined Wells a year ago from MasterCard, is also a director as well as Mondex International vice chairman.

The others are Walter Korchin, senior vice president and general counsel of AT&T Universal Card Services; Ronald Braco, senior vice president at Chase; William Simmons, executive vice president of Novus, the Dean Witter merchant services unit; Bruce Nyberg, senior vice president, First Chicago NBD; Alan Heuer, MasterCard's U.S. region president; and Michael King, senior vice president of alternative delivery at Michigan National.

Michigan National's parent, National Australia Bank, is a Mondex global founder.

Mondex USA actually consists of two Delaware-incorporated entities: a services company headed by Ms. Hartung and a lower-profile originating company charged with monetary operations and risk management issues. Wells Fargo vice president Jim Rudd is president of the latter.

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