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PARIS, France (AP) -- France is leaping toward a cashless future with a nationwide launch this year of computerized "smart cards," a concept that has so far failed to entice many American, British and German consumers.
The chief idea behind this new breed of microchip-embedded plastic is simple -- to dispense with pocket change and speed smaller transactions.
Dubbed "Moneo," the French electronic purse cards were introduced two years ago in a handful of small regions. In November, the service expanded to include Paris.
Some 850,000 consumers now regularly use Moneo cards at 80,000 grocery shops, parking lots or vending machines, says Pierre Fersztand, chief executive of BMS, the technology company that launched the project.
Because the basic Moneo card is anonymous, there are no privacy or identity theft concerns. But if an owner loses his or her smart card, the cash that's stored onboard can be used by whoever finds it -- which is why there's a $107 storage limit.
Fersztand expects the cards to be available to merchants and customers nationwide by the end of the year.
"We're not worried about whether it will take off here," he said in an interview at the company's Paris headquarters. "The question is how long will it take -- two or 10 years?"
Every French bank has signed up for Moneo. All the major banks are shareholders in BMS, as well as the SNCF railway authority and the Paris mayor's office.
Just like in earlier projects in New York or England, users can upload money from their bank accounts onto smart cards at special teller machines in banks and post offices. Conveniently, they can also refill the so-called stored value cards at any participating shop, supermarket, ticket booth or cinema, punching in a PIN number for security reasons.
No PIN is required to dispense cash.
And for those who dislike the idea of yet more plastic in their wallets, Moneo can be incorporated onto their existing credit cards -- something that has never been tried outside of France. In fact, it's already been automatically added to 25 million credit cards that were up for renewal -- with the owners not always being aware of it, Fersztand said.
"They have learned the lessons of past mistakes," said Therese Torris, senior analyst at Forrester Research. "We do think it has a chance to succeed (in France), whereas other initiatives had a zero chance."
Among the challenges: how to ensure the cards are widely accepted, quick to use, easy to refill and carry low transaction fees for merchants. Banks generally charge between 0.4 and 0.9 percent per transaction, and consumers have to pay an annual fee of $6 to $13.
So far, reaction is predictably mixed.
Gregory Clau, 30, said only one customer has used the service since he installed it three months ago at his locksmith shop near the Champs-Elysees.
"I don't think anybody is interested in it," he said.
The dozen people a day who use Moneo to buy their baguettes and cakes at Chantal Plousseau's Paris bakery might disagree.
"More and more people are using it," said the 50-year-old Plousseau. "It's efficient and eventually I will make less trips to and from the bank carrying bags of coins."
Smart cards have seemed to be perpetually on trial.
A limited launched in New York City in 1998 failed because of system glitches. Merchants complained about allocating precious counter space to the card reader, and consumers lost interest without a financial incentive such as rewards programs.
Perhaps more importantly, the system wasn't profitable for the issuers, and banks couldn't charge for the cards' use until consumers and retailers were willing to pay for the convenience.
The few successful rollouts have occurred in controlled settings like university campuses or with the U.S. military, where smart cards serve as far more than electronic purses.
Many U.S. and British students use them to buy food or drinks at college cafeterias and bars, gain access to buildings and computer files or check books out of the library. Smart cards also now serve as digital IDs for U.S. soldiers, authenticating them on computer networks, among other uses.
In Japan, 650,000 electronic purses known as "Edy" cards are in circulation and can be used at 2,100 stores, mainly in the Tokyo area. But unlike in France, the cards can only be refilled at special machines or using gadgets that hook up to personal computers.
Fersztand acknowledges that French, like many people, enjoy the jingle of coins in their pockets. But he hopes to offer an alternative -- not a replacement.
"We all know that the future of money is completely virtual," said Torris, the Forrester analyst. "Moneo is a first step toward that."
Try telling that to Christine Berube.
She is refusing to offer the service at her tobacco counter in a dimly lit bar that serves up endless glasses of cheap table wine and cups of coffee to mostly elderly regulars.
"I think it's useless," the 46-year-old tobacconist said to nods of agreements from clients who draw heavily on their cigarettes. "I know how to count change quickly and don't want to enrich the banks."
http://www.cnn.com/2003/TECH/ptech/02/08/cash.smart.ap/index.html
The chief idea behind this new breed of microchip-embedded plastic is simple -- to dispense with pocket change and speed smaller transactions.
Dubbed "Moneo," the French electronic purse cards were introduced two years ago in a handful of small regions. In November, the service expanded to include Paris.
Some 850,000 consumers now regularly use Moneo cards at 80,000 grocery shops, parking lots or vending machines, says Pierre Fersztand, chief executive of BMS, the technology company that launched the project.
Because the basic Moneo card is anonymous, there are no privacy or identity theft concerns. But if an owner loses his or her smart card, the cash that's stored onboard can be used by whoever finds it -- which is why there's a $107 storage limit.
Fersztand expects the cards to be available to merchants and customers nationwide by the end of the year.
"We're not worried about whether it will take off here," he said in an interview at the company's Paris headquarters. "The question is how long will it take -- two or 10 years?"
Every French bank has signed up for Moneo. All the major banks are shareholders in BMS, as well as the SNCF railway authority and the Paris mayor's office.
Just like in earlier projects in New York or England, users can upload money from their bank accounts onto smart cards at special teller machines in banks and post offices. Conveniently, they can also refill the so-called stored value cards at any participating shop, supermarket, ticket booth or cinema, punching in a PIN number for security reasons.
No PIN is required to dispense cash.
And for those who dislike the idea of yet more plastic in their wallets, Moneo can be incorporated onto their existing credit cards -- something that has never been tried outside of France. In fact, it's already been automatically added to 25 million credit cards that were up for renewal -- with the owners not always being aware of it, Fersztand said.
"They have learned the lessons of past mistakes," said Therese Torris, senior analyst at Forrester Research. "We do think it has a chance to succeed (in France), whereas other initiatives had a zero chance."
Among the challenges: how to ensure the cards are widely accepted, quick to use, easy to refill and carry low transaction fees for merchants. Banks generally charge between 0.4 and 0.9 percent per transaction, and consumers have to pay an annual fee of $6 to $13.
So far, reaction is predictably mixed.
Gregory Clau, 30, said only one customer has used the service since he installed it three months ago at his locksmith shop near the Champs-Elysees.
"I don't think anybody is interested in it," he said.
The dozen people a day who use Moneo to buy their baguettes and cakes at Chantal Plousseau's Paris bakery might disagree.
"More and more people are using it," said the 50-year-old Plousseau. "It's efficient and eventually I will make less trips to and from the bank carrying bags of coins."
Smart cards have seemed to be perpetually on trial.
A limited launched in New York City in 1998 failed because of system glitches. Merchants complained about allocating precious counter space to the card reader, and consumers lost interest without a financial incentive such as rewards programs.
Perhaps more importantly, the system wasn't profitable for the issuers, and banks couldn't charge for the cards' use until consumers and retailers were willing to pay for the convenience.
The few successful rollouts have occurred in controlled settings like university campuses or with the U.S. military, where smart cards serve as far more than electronic purses.
Many U.S. and British students use them to buy food or drinks at college cafeterias and bars, gain access to buildings and computer files or check books out of the library. Smart cards also now serve as digital IDs for U.S. soldiers, authenticating them on computer networks, among other uses.
In Japan, 650,000 electronic purses known as "Edy" cards are in circulation and can be used at 2,100 stores, mainly in the Tokyo area. But unlike in France, the cards can only be refilled at special machines or using gadgets that hook up to personal computers.
Fersztand acknowledges that French, like many people, enjoy the jingle of coins in their pockets. But he hopes to offer an alternative -- not a replacement.
"We all know that the future of money is completely virtual," said Torris, the Forrester analyst. "Moneo is a first step toward that."
Try telling that to Christine Berube.
She is refusing to offer the service at her tobacco counter in a dimly lit bar that serves up endless glasses of cheap table wine and cups of coffee to mostly elderly regulars.
"I think it's useless," the 46-year-old tobacconist said to nods of agreements from clients who draw heavily on their cigarettes. "I know how to count change quickly and don't want to enrich the banks."
http://www.cnn.com/2003/TECH/ptech/02/08/cash.smart.ap/index.html
