Sony's Cashless Smart Card Catching on in Japan

Spasemunki writes "The New York Times reports here on the success in Japan of an RF-based, cash replacement smart card developed by Sony. Used primarily by Japan's largest railway company, the cards carry a declining cash balance (no link to your credit card or bank account if it is lost or stolen), and conducts transactions at railway turnstiles in 1/5 of a second. Mass transit remains one of the big areas for many folks where you just can't live without cash- this would be a big improvement over digging in the couch for exact change ... "

Potential uses...

[watzinaneihm]

With smart-card readers integrated into your computers, will this be the solution to the great micropayment problem? (Similar things have appeared on prev. /. stories, so idea not mine)
Or will somebody spam your computers with viruses to steal your money then?

Why "RF based/cash replacement? Metrocard

[indiigo]

Huh? NY has had metrocard for years, it's successful, disposeable, and considered a fairly resounding success and can be linked to cash or credit, giving you a range of options, some of which are beneficial to the consumer (you can let someone else use your card free.) I guess if it has a chip though it should be cool.

The token is dead. Cash is dying. off topic, the dollar is dying, in particular... :)

Re:Great idea!

[tekunokurato]

I know the "win-win" remark above was sarcastic, but think of it like this:

First, there's virtually no interest to be collected in Japan regardless. Short rates are practically zero, and barely enough to recoup transaction costs.

Second, let's say the bank actually WAS collecting interest on your cash. Well, what are you going to do with it? You've got two choices: you can bury your money and not let anyone make any interest off it (because you're certainly not using it productively if it's sitting in your pocket), or you can lend it to someone to make money with, and it'll be instantly recoupable.

Technically, if everyone converted all their cash and let banks have it while they weren't using it, the economy would be more productive, and might do better.

Of course, the availability of cash might push interest rates lower, but it also might increase the willingness of people and companies to invest in productive products, possibly helping the Japanese economy out of its crisis.

Re:Does this have "big brother" implications?

[schtum]

for those who have no idea what he just said, handy == cell phone, or mobile phone, in Germany (and perhaps a few other places as well?). Most Germans are surprised to discover that "handy" isn't the regular English term since the word is clearly derived from English. I learned this from a friend who took German in college, and it still took me a few seconds to interpret the above post.

Re:Officer, I've been mugged!

[91degrees]

Unfortunately this is low-crime Japan. You'd have to spend a few minutes explaining to the police what mugging means, and convincing them that someone would be so dishonourable as to do such a thing.

Re:Belgium : proton

[CvD]

We have the same here in the Netherlands (its called ChipKnip). You forgot to mention one of the more annoying problems: you don't know how much you are carrying. You can't look at your card and find out how much money is still on it.

Actually, this would be a cool application for that plastic flexible panel display thingy that was on /. a while back, have it embedded on your card. The only problem with this would be powersupply.

And yeah, the readers are very suceptible to dirt and other crap. Also the metallic contact points tend to get somewhat corroded after a while. I clean them with a pencil eraser. Works like a charm.

Cheers,

Costyn.

Octopus in Hong Kong is used for ID

[mamahuhu]

In Hong Kong many housing estates, offices and schools are using the Octopus [octopuscards.com] card for identification. There are 9 million cards in Hong Kong with a population of only 7 million. One of the reasons is that some people require two cards - perhaps one for the office and travel, maybe another for the housing estate.

I went to a conference [hkiiexpo.com] recently and I was required to register with my Octopus Card to get entry to the conference floor. It was useful because I went back later in the week and of course I had the card with me so got without any re-registering.

School kids use them to get into school and a roll call is instantly made up. Entry and exit to the school can then be monitored. This is not so different from the access cards I have used at several offices - the difference is that I've had my Octpus card for years now and theoretically all the transactions, travel, entry and entrance could be recorded. A bit scarey I admit.

However there is no link back to me. There is no name attached to the card, and no connection with a bank account. So there is a limit to the amount of data o be tracked.

There are a lot of uses [octopuscards.com] for the cards.... it is pretty good technology.... except that they in effect have a monopoly and charge 10% commission on the sales going through there system. Imagine having a monopoly on cash and making a profit everytime you used your coins and notes.

I think you will find that there will be more and more of these cards used. Already Nokia has built it into some of their phones in Hong Kong, you can buy watches with it built in - people like it - very easy, no coins, no need to rummage around for the train ticket just wave your wallet at the gate. Ditto for keys to the office, home - soon perhaps your car. They're already used for payment at car parks and soon car meters.

People won't resist this so the best thing is to build in safeguards, walls between systems so no accumulation of data is made unduly.

Face it - it's coming. It's here in Hong Kong now.

GO Transit, Richmond Hill Line

[The Wing Lover]

GO Transit in Ontario, Canada, has implemented a similar system on its Richmond Hill line, as a test.

GO uses a Proof of Payment system -- you buy your tickets, and then "cancel" one ride off a multi-ride ticket before you get on the train, and you have to prove to the inspector, if she checks, that you have purchased and cancelled your tickets.

The Smart Card system that GO uses is great -- it can store up to 255 pre-paid rides and 2 monthly passes (ie, one for this month and one for next month). To cancel your ride, you don't even need to take it out of you wallet -- just hold the wallet up to the card reader. The machines work far faster and with much less downtime than the old style of "punching your tickets" ride cancellers. Even providing proof of payment is as simple as letting the inspector scan your card with a handheld card reader.

It's a great system and I hope they replace the old system on the other lines soon.

In Post-Soviet Estonia...

[bj8rn]

...no, we don't have cash smart cards. But one or two cellphone operators are experimenting with systems that allow you to buy tickets for public transport (mostly buses) using a cellphone. You just have dial a certain number (depends on whether it's an one-hour or 30-day ticket etc) and you'll get an SMS to prove that you have paid for your ride. An alternative version of this includes a magnetic card so you wouldn't have to <i>show</i> your cellphone to the ticket collector. The price of the ticket is added to your phonebill. I haven't used this thing myself, but the bus company say it's more popular than they expected.

Cash Will Never Die

[0xB00F]

People have always been using "cash" in one form or another. This is just another form of "cash".

Follow the evolution:

1. People trading goods with one another, i.e. my 5 pounds of butter for your 4 pounds of cheese.
2. People using rare, precious objects, i.e. seashells, precious metals, round stone thingies.
3. People using coins.
4. People using paper money and cheques.
5. People using credit and debit cards.

The smart card is just another debit card, which is just another form of cash. To be truly cashless, you need to get rid of the concept of "legal tender" which is what "cash" basically is. But that wouldn't be a very good idea, unless you like the idea of foraging for food everyday.

0xB00F, the sound of a foam rubber mallet hitting your head.

Re:Belgium : proton

[GroovBird]

Banksys, the company that runs the Proton system, produces keychains that let you figure out the amount you have on your card. It will also show you your last five transactions. Plus, you can check the amount in any card reader in any location, wether they are credit or debit readers.

Dave

Finland

[Suomalaanen hjy]

Hoping to comment the right post this time..

We've had those smart cards in use in Finland for many years now. Most are city-specific, so you can't use them outside that particular city they are for. The uses for those smartcards are in electrical identification, so you don't need usernames and passwords, only a card and a pin number (and a cardreader), and mass transportation. You can also pay your purchases in some shops with those cards. Some can be read from a distance, so you don't have to take them out your wallet.

Cash cards in Europe

[subri]

This concept is quite hot in european countries - like The Netherlands. It is just a smart chip on your credit card / ATM card. There are machines attached to almost all ATM machines which will help you load cash into this chip. Typically one would load about $5 worth of cash. The advantage is, it replaces the annoying coins - more than it does cash. No more coins to count. I thought it was a neat idea.

Moscow subway : RF cards since 1998

[saikou]

In Moscow, subway system have been using contactless RF Card since 1998 [metro.ru]. You wave the card at sensor and that's it (same as SpeedPass for gas station). Really fast, rechargeable, easy to use.

They say one guy was hiding RF card uner his cap, and then amazed controller ladies by taking a bow in front of sensor. Of course it worked and it'd let him through :)