The Snapper company, which issues the payment card of the same name widely deployed in Wellington, is pitching it against the “chip and PIN” credit card. This is the more secure form of card payment currently being deployed by the banks, to replace magnetic stripe credit and eftpos cards.
At an announcement last month that Snapper cards can now be used with taxis, much was made of the faster transaction time for the Snapper card, as compared with chip and PIN cards.
The Snapper card has an embedded chip that is coupled with radio frequency identification technology, which means the card only has to be held in close proximity to the terminal to perform a transaction, not “dipped” into a slot as with bank chip cards, and no PIN or signature has to be tendered.
The company has uploaded a video to YouTube demonstrating the relative speed of the two transactions. However, a major selling point of chip-and-PIN cards is security. Snapper says the card does not currently accommodate a PIN and is unlikely to do so in the foreseeable future.
The card is intended for low-value transactions, says CEO Miki Szikszai; the vast majority are under $35. In the way it is used, he says, it is nearer cash than credit or debit cards, which give access to an account.
However, he suggests with banks issuing debit cards and preloaded cards, the average value of a chip-and-PIN card transaction is coming down and the markets for the two are overlapping more.
The Snapper card is now reloadable from a user’s bank account through new kiosk terminals and (in the case of the USB-key model) desktop PCs, with this further blurring the distinction between the two forms of card.
Following the recession, as people become more conscious of credit-card debt, Szikszai suggests the public are moving from the conventional credit card to debit cards and preloaded credit cards, and this again brings the competition closer.
But there is no current intention to put a PIN on the Snapper card, he says. “We’re looking at different security models, but we keep coming back to speed as a big attraction.” He declines to say what other “models” are being considered.
“Security can be viewed at various levels,” he says. The security of identification at transaction time may be a little lower, but transaction information is still impossible to trap in transit, because each transaction is individually encrypted. A Snapper card cannot be cloned, he maintains.
Unlike cash, the card can be protected against loss or theft by registering it with the Snapper company, which can cancel the remaining balance and transfer it to a new card if the verified user reports the card lost.
Only 40 percent of issued cards have been registered, but that proportion is going up now the company has made the registration process easier, Szikszai says.