Cashless society stops at Swindon

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The Independent Online
It was hailed as the beginning of the end for the pound in your pocket. But the experiment in "electronic cash" has failed to find many buyers and looks unlikely to spread past Swindon.

A year after its launch, the town of 170,000 is still the only place in the world where you can buy a drink in a pub using a microchip. Despite the enthusiasm of Mondex, a consortium of the National Westminster and Midland banks and British Telecom, it said yesterday that the experiment will not be extended to any other town in Britain. Instead it will be tried in universities and other "closed environments".

A limited Mondex trial is under way in San Francisco, where it is being used by some bank employees, and others are planned for Ontario, Hong Kong and an Australian city. Swindon, though, remains the most ambitious of the trials.

A Mondex spokesman said: "I think people would like to be able to use their Mondex cards outside Swindon. But there's no other place like it."

The trial began with 500 people using "smart cards" which stored money in the form of electronic digits on a microchip.

Rather than carrying cash, cardholders could load up their cards with money from their bank accounts using special readers attached to a phone. They could spend it in shops, or pass it to other people who also had cards. The transactions are anonymous, just like cash.

Each card can hold an unlimited amount of money, though not a negative amount.

However, despite Mondex's early forecasts that 40,000 of the town's 170,000 population might use the cards by today, in fact only 10,000 have done so.

Neil McEvoy, director of the management consultancy Hyperion, which has been working with Mondex on the project, said: "I think the problem was that for the things where it's really useful, such as for bus fares and car parks - where change is too troublesome - the facilities weren't available until about six months ago.

"By then, people had probably thrown away the stuff explaining how they could get into the trial."

But retailers who offer facilities to accept the cards say that it provides benefits over cash. "For us, it's super," said Paul Notton, co-owner of Rudi's bar and restaurant in Swindon. "It's very good for the sort of trade we have. Cash can go missing. In the last three months we've seen it become more popular.

"People use it for transactions of anywhere between pounds 5 and pounds 30. If all the banks used it, that would be very good.

"From our point of view it means we don't have to go to the bank to get change. But like most new things, it's hard to envisage how it might be used at first."

He says there are about 80 Mondex transactions each week, forming about 2 per cent of the total volume.

Agnes Dodding, at the Heart in Hand pub, said: "We get a steady stream of regulars using it. If everybody used it, that would be nice, because we wouldn't have to cash up."

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