Say goodbye to swiping.
Nearly a million “contactless” credit cards are making their way to Colorado courtesy of Chase Bank, which is taking over local Bank One operations.
The new “blink” cards eliminate the need for consumers to give their cards to cashiers. Colorado, along with Georgia, is getting the new technology.
The cards work like traditional cards, except they have microchips that communicate with terminals. Users hold them to a reader, not unlike waving a security badge to unlock a door. The terminal beeps when payment is made.
Nearly 400 merchants in the state, including Arby’s, Walgreens, 7-Eleven and Regal Cinemas, have installed terminals to read the latest wave in card technology.
“People in Colorado are on the go,” said Thomas O’Donnell, Chase senior vice president of marketing. “Blink is focused on speed and convenience.”
The cards also are secure, the company maintains.
They work only when placed within inches of a reader ready to complete a transaction, O’Donnell said. The data on each card also are encoded, and the codes are changed after every transaction.
But the strongest security feature is that the card never leaves a customer’s hand, preventing others from copying numbers, he said.
Executives at Arby’s, which has installed readers in 49 stores, estimate the cards and readers will shave about 10 seconds off transaction times.
“With the new machines, it will be very fast in the drive-through,” said Jeff Gordan, Arby’s operations controller.
The technology gets at two problems – customers who slow down the line paying cash because they are nervous about handing their cards over, and customers who drive off without their cards.
Merchants who move a high volume of customers making low-dollar purchases, such as fast-food restaurants and movie theaters, are likely to see the greatest benefits, said David Robertson, publisher of The Nilson Report, a consumer-payment industry newsletter.
“It won’t matter to you as a consumer,” Robertson said. “It will matter to the merchant to get you through the checkout lane faster.”
Chase and American Express are the first two card providers to roll out contactless cards. Another half-dozen providers should follow by year-end, Robertson said.
Chase’s rollout is timed with the reissuance of 94 million credit cards following a merger between Bank One and its parent, JPMorgan Chase & Co.
Locally, Chase plans a big advertising campaign with the theme “Cash just got boring.” On Monday, Chase is rebranding Bank One locations in the state.
O’Donnell said magnetic stripes currently on the back of credit and debit cards represent 30-year-old technology. Chips, which have much more memory, could offer rebates or frequency discounts at the point of sale in the future, he said.
Staff writer Aldo Svaldi can be reached at 303-820-1410 or asvaldi@denverpost.com.
