Page 29 - Sphere No.25 (Aug 2009)

SPHERE 27
being driven by the increase in pre-paid contactless smartcards.
In Hong Kong, the Octopus card is one such example.
Launched in 1997 to pay fares on the city’s burgeoning mass
transit rail system, the Octopus card can now be used on virtu-
ally all the city’s public transport networks and in convenience
stores, supermarkets and fast-food restaurants as well as for
parking metres, car parks and other point-of-
sale applications such as service stations and
vending machines.
With its high-density urban population and
compact geography, Hong Kong is perhaps the
perfect model for these types of cards. Banks have
been quick to see the benefits for customers and
have produced their own cards, and now the co-
branded DBS Bank and Hutchison Whampoa
Limited ComPass Visa card is joining the club.
Selected ComPass Visa cardholders will be able to make pur-
chases of up to HKD500 (USD64) at a wide range of retail out-
lets, including Hutchison group stores such as PARKnSHOP,
GREAT, TASTE, Watsons and Watson’s Wine Cellar, and other
retailers, by simply holding the card in front of a scanner.
The benefits are obvious. The transaction takes place in the
blink of an eye – there’s no fumbling for cash or waiting for your
card to be swiped and then having to sign the credit card slip.
“It’s a growing trend in the Asia Pacific.The whole retail indus-
try is moving in the direction of a cashless society,” said Bernard
Chan, Senior Vice President of ComPass Visa. “Our research
in Hong Kong shows that more than 70 per cent of purchases
made by Compass Visa customers are for less than HKD500.
The technology is advanced, secure and very convenient. The
card saves so much time for both the customers and the mer-
chants. It’s what people want and customers can check their pur-
chases and transactions on their credit card statements.
“When customers make micropayments they also enjoy all
the same cash rebate reward. We think using the credit card for
a lot more low ticket items will become a habit, especially as the
same loyalty programmes and merchant discounts apply.”
Cardholders simply place their cards in front of a secure
reader at the checkout counter. The card utilises the latest Visa
payWave technology which uses a Europay MasterCard Visa
(EMV) chip to securely store and encrypt confidential informa-
tion. An EMV chip is virtually impossible to copy and uses RSA
public key algorithms with up to 1984-bit keys that uniquely
identifies each transaction. No two cards share the same key,
and the key is not transmitted.
“When payWave cards were first launched in Hong Kong,
there were some customers who were concerned about securi-
ty. But with our Lost Card Total Protection Service, customers
are protected and are totally free from liability for unauthorised
transactions. We also offer a 24-hour customer hotline for their
peace of mind,” said Mr Chan.
Payments are made via radio frequency, much like those used
in mass transit environments. A Visa payWave card has an an-
tenna embedded in the card plastic. By simply holding the card
to the reader, the chip in the card allows the instant transfer of
information. The cardholder’s account is charged, and the pur-
chase is processed in the same manner as a swiped transaction.
This saves consumers valuable time. Watsons in Taiwan said
that Visa payWave reduced queuing time by 77 per cent in its
outlets. According to Visa, the average transac-
tion by credit card takes 25 to 35 seconds, cash
12 to 14 seconds and Visa payWave four to six
seconds. Contactless payments are also more
secure – the card never leaves the cardholder’s
hands, thereby reducing the opportunity for the
card to be skimmed.
Globally, the move away from cash to con-
tactless smart cards is gathering speed. Huge
steps have been made in the United States and
Europe in recent years and a quick glance at the Contactless-
News Website shows that the process is also gathering steam
in less developed markets. PayWave cards are now available in
Tbilisi, Georgia!
So, while society may never become entirely cashless, it seems
almost certain that it will play an ever decreasing role in day-to-
day life in developed, urban society.
Left: Consumers are moving away from using cash for small
purchases such as a cup of coffee. Above: Selected ComPass
Visa cardholders will be able to useVisa payWave to make
purchases of up to HKD500 at a wide range of retail outlets,
including GREAT.
The chip in
the card allows
the instant
transfer of
information