Higher Ed

Last week I attended the three-day, annual CardTech SecureTech conference in San Francisco, where the latest in identification and payment card technology was on display.  When it comes to campus card technology, the name of the game is clearly "contactless.”

You are no doubt familiar with the brown magnetic stripe on the back of your credit card.  (If you’re like me, you avoid carrying cash at all costs in lieu of using a bank debit card for convenience.)  And you’re probably equally familiar with paying for purchases by swiping your card through a point of sale register; for instance, when you check out at your local grocery store.

Those registers are designed to “read” the data—essentially your credit card number—anytime you swipe your card.  But in order for that to happen, that magnetic stripe on the card must actually come in contact with a tiny read head that sits inside the register.

Now consider the idea of contactless transactions.

Next generation credit cards and card readers are starting to appear in the market that allow cardholders to simply wave their card in front of a device to process a transaction.  Programs such as MasterCard’s PayPass and Visa’s payWave are making headway in the marketplace, and new card readers are suddenly appearing in national chains like CVS/Pharmacy, McDonald’s, 7-11, Walgreen’s and Regal Cinemas.

The rollout of these programs is steadily growing; at the end of 2006, nearly 10 million contactless credit and debit cards were in circulation in the United States. And by the time your current credit card expires, it’s likely your bank will issue you a contactless card.

While the magnetic stripe still appears on the back of the card, a small chip is also embedded inside the plastic—encoded with your account information—and enables the transmission of data between the card and the reader by virtue of proximity.  A proximity card allows the consumer to simply touch their card to the reader and go, and it’s a secure method of payment.

The drive to contactless payment is all about convenience, as evidenced by the fact that more consumers are using their credit or debit cards for smaller transaction amounts, less than $5.  That number will surely grow as contactless issuance and acceptance expands.

The contactless revolution is not limited only to payment.  Contactless cards can also be used to allow for physical security, as some universities have already done with their campus cards.

University communities are virtually cashless already. Students use their campus ID cards to pay for all their purchases, including on- and off-campus meals, laundry services and vending machine items.  In fact, Blackboard recently released a new card reader, the FlexVend Vending Reader, for vending machines that not only accepts the campus ID card but contactless credit cards as well.

Speed of service is critical on college campuses, and payment by campus ID card is ubiquitous.  With a young populace eager to utilize new technologies that make their lives easier, it’s worth keeping an eye on the contactless revolution.