For most people, banking from home means using the telephone to get balances or move money around between accounts, and maybe to pay bills. The more advanced can use personal computers to do the job. But if you need cash, forget it; no one has offered a way to push a dollar bill down a telephone line.
Until now, that is. In a trial by two Canadian banks, some Toronto-area residents will soon be loading "cash" onto smart cards, using a small device attached to a telephone. "Remote access" to a bank account thus takes on a new meaning. It's not a credit card or debit card, but a substitute for cash - a digital purse.
Unlike paper cash, however, this "cash" can only be used at properly equipped stores or machines. Retailers, vending machines, parking meters, and pay phones will accept the cards as long as they have a reader to accept the cash. The card is "loaded" with digital cash when a customer pushes a code on the telephone then swipes the card through the card reader on the side of the phone.
The trial will be in Guelph, a small city west of Toronto. The test involves some of Canada's biggest businesses.
"This is going to be the first trial in North America," says Terry Sydoryk, senior product manager at Northern Telecom in Calgary, where the special phone and attachable card-swiper are being manufactured. Another trial in Swindon, England, has been going on since July, he adds. Three-fourths of the Swindon retailers accept the money cards.
The smart-card technology is from Monde, a joint venture of Britain's NatWest and Midland banks. In Canada, the participating banks are the Royal Bank and the Canadian Imperial Bank of Commerce.
Other companies are also interested in marketing smart cards. VeriFone Inc. of Redwood City, Calif., recently announced its version of a smart-card device for the home.
The cards also may have applications beyond banking. IBM and American Express announced card technology to streamline the process of buying airline tickets and checking in at the airport.
In the Canadian trial, if you run out of cash on your smart card, you don't have to run home to get more. Guelph will have hundreds of pay phones with card readers. Phone giant Bell Canada is another partner in the test.
"The manufacturer makes money from selling the units, the banks probably from service fees, and the phone companies from rentals or service fees," says a telecommunications executive who asked to remain nameless. "That's why it's called a trial. The technology works, but they've still got a lot of money details to work out."
Not to mention whether the cards will be a hit with consumers.