Contactless goes nationwide in the US


2005 has seen huge growth in the number of contactless cards rolled out by US issuers, with six of the top 10 having now launched contactless offerings (table).

JP Morgan Chase, which rolled out its ‘blink’ contactless cards in June 2005 (MPW 63), is set to follow through to most of its card portfolio and seems the most advanced in its plans. ‘Chase are due to issue five million contactless cards by the end of 2005,’ says Guido Mangiagalli, consumer market development, Visa Europe: ‘This figure is set to rise to 20 million by 2006.’

Citibank was the first US issuer to deploy MasterCard’s PayPass commercially. Beginning with its ATM/debit card, Citi also began to pilot PayPass for its credit card customers and now issues PayPass on both card types. Following initial launch in New York, Citibank plans to roll out 2.5 million PayPass debit devices across the country in various forms, including a key fob.

As well as Citi and Chase, MBNA, KeyBank, HSBC America and American Express have began large-scale contactless deployments. MBNA, the most recent, launched PayPass in Atlanta in October 2005, with additional markets to follow.

MBNA already has 11 MasterCard PayPass card programmes centred on Atlanta, including a co-brand with the Atlanta Braves, 9 local university alumni cards and its WorldPoints credit cards.

Atlanta has emerged as the epicentre of the US roll-out because of the large merchant base accepting contactless cards, says MBNA group executive David Turner: ‘We’re excited at how fast the list of merchants who have committed to accepting PayPass continues to grow.’

Speedpass, the contactless programme which Exxon launched in 1997, continues to grow as well. It currently has over 6 million active users, with acceptance at 8,600 service stations and convenience stores across the US.

Sceptics will question whether the US contactless roll-out is the real thing or just a passing fad. Smart card programmes like AmEx ‘Blue’ and Target Visa were expected to kick-start EMV implementation in the US, but all failed.

Consulting group First Annapolis suggests several reasons why it’s different this time: