In retreating from the Internet payments business, First Virtual Holdings Inc. is encouraging its 2,000 active merchant accounts and 60,000 consumers to become Cybercash Inc. customers.

The move could help Cybercash close in on the 10,000-merchant mark that it has viewed as a key to profitability. The Reston, Va., company, which entered the Internet payments business about the same time First Virtual did, serves more than 7,000 merchants. That number increased by 750 in June. First Virtual has turned its attention to interactive messaging and advertising.

Cybercash has agreed to use San Diego-based First Virtual's messaging platform and integrate its payment system into the service. Other terms were not disclosed.

"We expect few, if any, ripples" in the on-line payments area, said electronic commerce analyst Scott Smith of Current Analysis Inc., Sterling, Va. "First Virtual's business was dead, and Cybercash gains a small group of users" who are "not necessarily high-value customers."

Maureen Loftus of Cybercash said the company aims to convert one-third to one-half of First Virtual's merchants. Ms. Loftus, senior vice president of corporate marketing and strategy, said it is a chance to "obtain critical mass."

In June, the struggling First Virtual received a $6.6 million infusion from Softbank Holdings Inc., the Japanese-owned information conglomerate. Softbank now owns $5.8 million in First Virtual stock, giving it 64% ownership and three board seats. Softbank also owns 8% of Cybercash, but officials said the First Virtual-Cybercash negotiations were under way before Softbank invested in First Virtual.

Cybercash has created a special registration area on its Web site and devoted five technicians to help First Virtual customers move to its system.

First Virtual's commitments to merchants expired June 30, allowing for the transfers, said president Keith Kendrick. First Virtual defines active users as customers who make two purchases within six months, he said.

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