According to documents lodged at Companies House, Mondex generated fee income of pounds 29.4m and earned pre-tax profits of pounds 2.69m in July to December 1996, its first period of operation.
Mondex, like other smartcard firms, is racing to produce and distribute cash cards which use computer chips to allow consumers to "load'' the cards with cash and spend it on small items, as they would a phone card.
Visa, the world's largest card company which is owned by thousands of banks around the world, warned at a banking meeting in Hawaii this month that Mondex could threaten the dominant credit-card companies.
That will be of much less concern to Mastercard, Visa's credit-card rival, which hedged its bets last month when it bought 51 per cent of Mondex from a group of banks. According to company documents, Mastercard paid "up to pounds 10m and other considerations". NatWest originally devised Mondex and sold 90 per cent of it to the bank group last July. NatWest will continue to receive royalties for devising the technology.
Mondex has managed to move into profit so quickly through selling franchises to the banks that will distribute the cards.
"Every time we make a sale, we effectively increase our customer base,'' said Mondex spokesman Robert O'Kelly, who points out that its bank customers will continue to pay fees as long as they issue the smart cards.
He said Mondex's 1996 revenue came from signing franchise agreements with financial companies in 18 countries last July. Mondex has now built up franchises in 26 countries in Europe, North and Central America, Asia and Australia.
Other card companies have criticised Mondex in the past, saying regulators are concerned that its ability to transfer money directly from card to card could lead to money laundering or fraud.
Mondex denies the claim and the Bank for International Settlement says it is simply a matter that must be monitored.Reuse content