Swindon takes smart route to cashless society

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The Independent Online

Technology Correspondent

Swindon might seem an unlikely place for a revolution to begin and the local newspaper, the Evening Advertiser, an unlikely weapon to deal the first blow. But this morning a copy of the paper will be bought using "electronic cash" held on a credit-sized card, starting a 12-month experiment that could launch the cashless society.

From today, 500 Swindon citizens will carry "smart cards", which will store cash in the form of electronic digits on a microchip. The holders can load their cards with money from their bank accounts using card-readers attached to the telephone. They can spend it at 700 outlets, including pubs, supermarkets, chemists and petrol stations.

By the end of the trial, up to 40,000 people could be using the cards, supplied by Mondex, a joint venture between the National Westminster and Midland banks and British Telecom.

"Electronic cash is going to cause a revolution," said David Birch, a director of the management consultancy Hyperion, who has worked with Mondex since the idea was mooted five years ago. "It means small sums of cash can be transacted securely, instantaneously and economically."

The cash is held as numbers on the card's microchip, and a card can hold an unlimited amount. When the cardholder wants to pay, the card is put in a reader which transfers the sum to the retailer. The same system can be used over the telephone. "You could order and pay for a pizza at the same time," said Mr Birch. "That means that the delivery man doesn't have to carry cash or change, and the company doesn't have to worry about getting robbed. It's going to change our lives.

However, if the owner loses the card, the money is lost with it, like cash.

"The Mondex office received 5,000 applications to be in this trial before it had even begun the publicity for it. I thought it would be hard to get people to understand quite how radical this idea is. But it seems to have sunk in with some of them."