Personal Business: Debit Cards
CASH ON A CARD ARRIVES IN AMERICA
Is the dawn of the cashless society upon us? No, but we're getting closer. Following Europe's lead, a rising number of U.S. service providers, from AT&T to Visa, are offering prepaid cash cards that can be used to make various purchases.
What these "stored-value cards" provide is convenience: less sorting through purses or pockets for coins, bills, tickets, and tokens. Unlike traditional credit and debit cards, prepaid debit cards don't involve elaborate electronic-transfer networks to bill and credit accounts. The user prepays a fixed amount, be it $20 or $120, and the value is imprinted on the card. When a purchase is made, the price is electronically deducted at the transaction site.
Prepaid fare cards have long been used by rail systems in such cities as San Francisco and Washington. Riders insert them into computerized station readers that withdraw the fare amount. When the card's value is depleted, the rider tosses it out and buys a new one.
The cards' uses have been multiplying. Several long-distance carriers now sell prepaid cards to use at pay phones. Besides helping callers impose limits on long-distance time, stored-value cards thwart shoulder surfers out to steal your long-distance calling-card number. AT&T's PrePaid Cards are available at AT&T phone centers in $6, $9, $15, and $30 denominations. Domestic calls run 60 a minute, international calls up to $3 a minute.
Meanwhile, Visa is planning to launch a prepaid travel card as an alternative to travelers' checks. You would buy the card at a bank, load it with whatever amount you want, and use it to take out cash in local denominations at ATMs anywhere in the world where Visa cards are accepted. The card can also be used as a gift or by an employer as an expense advance.
SMALL CHANGE. The next wrinkle will be multipurpose cards, good for making any number of small-change purchases. The New York City subway system, which is currently rolling out prepaid fare cards, hopes to expand the cards' purchasing power to station vendors. By 1996, riders may be able to buy periodicals, cigarettes, and snacks at the 1,000 newsstands and other outlets where fare cards will be sold. The MAC ATM network will be testing a similar technology in the mid-Atlantic states next year.E.S. Ely