Visa new payment technology plan
2005-02-26 02:04:44
Tired of having to swipe and sign every time you use a credit card?Visa is hoping to simplify the process of paying with plastic with a new payment technology it introduced Thursday. With the company's new "contactless" system, consumers need only wave credit and debit cards within a few inches of a reader to complete a purchase. And for purchases of less than $25, no signature is required.
The technology will be more convenient for merchants and consumers alike by reducing checkout times and lines, Visa executives said. It's also designed to be an easy alternative to cash for small purchases such as a soda or pack of gum.
"Our hope is that the contactless payment feature will drive added convenience and speed to consumers," said Niki Manby, vice president of market and technology innovation at Visa USA. "You no longer need to swipe or hand over your card."
But don't go waving your credit and debit cards around just yet. Visa must first convince merchants and card issuers to use new equipment. For merchants, that means purchasing new card readers. For banks, it means introducing special cards capable of transmitting account data via radio signal rather than magnetic stripe. So far, no card issuers are offering them, Manby said.
With 5.6 million merchants in the United States, Visa will need some time to phase out its old system.
"It's not something retailers will do lightly overnight," said Pennie Gillespie, a Forrester Research analyst.