Chase Brings Contactless Payments to the Northeast Corridor

JPMorgan Chase & Co. is extending its rollout of contactless payment technology to the populous northeast corridor of the country. Its Chase Bank U.S.A. N.A. said today it will begin sending new cards equipped with chips and tiny radio transmitters to some 2.9 million cardholders this week. In addition, about 3,000 merchant locations, including 7-Eleven Inc., CVS Corp., AMC Theater, and Duane Reade Inc. stores, will accept the cards to begin with, with more to come, the bank says. The rollout, which follows introductions by Chase of contactless cards in the Denver and Atlanta areas this spring, will bring to 5 million the number of cardholders to receive the so-called blink cards from the bank, or about 7% of its combined Visa/MasterCard account base. This latest initiative includes 2 million cardholders and 1,800 merchant outlets in the greater New York City area, including Connecticut and northern New Jersey, with merchants spread across 11 counties and located in 481 cities, the bank says. Cardholders will include those in the bank's Continental, Sony, United Airlines, Universal's King Kong, and Universal card portfolios. The launch also includes another 900,000 cardholders and 1,200 locations in the Philadelphia metro area, including Delaware and southern New Jersey. The bank will promote the launch in both areas with an integrated marketing campaign, as it has done in Colorado and Georgia. In addition, one of the merchant chains to accept the card, Wawa Inc., will issue a co-branded version of the blink card with Visa and Chase and will accept the contactless cards in all 540 of its convenience stores. Customers using the co-branded card to buy goods or gasoline at Wawa will receive 4% in rebates for every dollar. For the first 90 days of the campaign, they will earn 10%. For purchases elsewhere, these cardholders will earn 1% on each dollar spent, or 2% in the first 90 days. Chase has branded its contactless card “blink” because terminals accepting the card emit a tone and flash a light to confirm transactions. In contactless card payments, customers wave a token or card near a terminal, rather than swipe the card, to initiate payment. An inlay embedded in the card, which includes a chip and antenna, sends card-account data by radio wave to the terminal, which is equipped as a transceiver. From that point the transaction proceeds as if the card had been swiped. MasterCard International and American Express Co. have tested contactless technology extensively and have found it to be faster than conventional card transactions, making the technology appealing to high-volume, low-ticket merchants. Visa USA introduced its own contactless platform earlier this year. Visa and MasterCard waive their signature requirements on contactless transactions under $25, which also speeds up tender time. This has proven to be a breakthrough year for contactless technology. In addition to Chase's initiatives, several other banks have announced launches of RFID cards or tokens, with KeyBank, Citigroup Inc., and HSBC Bank U.S.A. N.A. linking contactless technology to debit card accounts (Digital Transactions News, Aug. 24 and Sept. 13). In addition, c-store kingpin 7-Eleven announced earlier this year its plan to roll out contactless acceptance to all 5,300 of its U.S. stores. “Contactless payment deployments must go national to achieve widespread consumer, merchant, and issuer support,” said Erik Michielsen, director of RFID and ubiquitous networks for ABI Research, in a statement. “Today's announcement [by Chase] reinforces the notion of a fast-developing, coast-to-coast contactless-enabled U.S. economy.”