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Article Information:
Title:
Why smart cards have failed: looking to consumer and merchant reactions to a new payment technology
Author(s):
Christopher R. Plouffe, Mark Vandenbosch, John Hulland
Journal:
International Journal of Bank Marketing
Year:
2000
Volume:
Issue:
Page:
112 - 123
ISSN:
0265-2323
DOI:
10.1108/02652320010339662
Publisher:
MCB UP Ltd
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Abstract:
For more than a decade, bankers and others outside the financial services community such as hardware manufacturers have sought to solidify the place of smart card technology as a viable retail point-of-sale alternative and, more boldly, as an outright replacement for cash in everyday consumption situations around the globe. Despite strong development efforts and numerous fact-finding market trials, many banks have found smart card technology to be a losing proposition. This article presents a detailed case study of both consumer and merchant adoption of one smart card-based retail point-of-sale system. The system, called “Exact”, was test marketed for a full year in the Canadian market. Various perceptual and demographic data from consumers as well as firm-level data from retailers are both presented and assessed. The ensuing discussion offers pragmatic suggestions for those in the financial services community as to how the apparent difficulties and shortcomings of smart card technology may be overcome.
Keywords:
Banks, Consumer behaviour, New technology, Retailing, Smart cards
Article Type:
Research paper