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Why smart cards have failed: looking to consumer and merchant reactions to a new payment technology

Why smart cards have failed: looking to consumer and merchant reactions to a new payment technology For more than a decade, bankers and others outside the financial services community such as hardware manufacturers have sought to solidify the place of smart card technology as a viable retail point-of-sale alternative and, more boldly, as an outright replacement for cash in everyday consumption situations around the globe. Despite strong development efforts and numerous fact-finding market trials, many banks have found smart card technology to be a losing proposition. This article presents a detailed case study of both consumer and merchant adoption of one smart card-based retail point-of-sale system. The system, called "Exact", was test marketed for a full year in the Canadian market. Various perceptual and demographic data from consumers as well as firm-level data from retailers are both presented and assessed. The ensuing discussion offers pragmatic suggestions for those in the financial services community as to how the apparent difficulties and shortcomings of smart card technology may be overcome. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Bank Marketing Emerald Publishing

Why smart cards have failed: looking to consumer and merchant reactions to a new payment technology

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References (27)

Publisher
Emerald Publishing
Copyright
Copyright © 2000 MCB UP Ltd. All rights reserved.
ISSN
0265-2323
DOI
10.1108/02652320010339662
Publisher site
See Article on Publisher Site

Abstract

For more than a decade, bankers and others outside the financial services community such as hardware manufacturers have sought to solidify the place of smart card technology as a viable retail point-of-sale alternative and, more boldly, as an outright replacement for cash in everyday consumption situations around the globe. Despite strong development efforts and numerous fact-finding market trials, many banks have found smart card technology to be a losing proposition. This article presents a detailed case study of both consumer and merchant adoption of one smart card-based retail point-of-sale system. The system, called "Exact", was test marketed for a full year in the Canadian market. Various perceptual and demographic data from consumers as well as firm-level data from retailers are both presented and assessed. The ensuing discussion offers pragmatic suggestions for those in the financial services community as to how the apparent difficulties and shortcomings of smart card technology may be overcome.

Journal

International Journal of Bank Marketing – Emerald Publishing

Published: Jun 1, 2000

Keywords: Banks; Smart cards; New technology; Consumer behaviour; Retailing

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