The Swiss (well, Japanese) Army Knife of Cards
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7 April 2009
I was in Japan on vacation last week, and saw a payment card that would likely make any U.S. card expert's head explode -- allow me to explain. I'll start with the easy stuff. This is a Visa-branded credit card, issued by Mizuho Bank of Japan. As such, it functions like any other Visa-branded credit card. Getting a wee bit trickier, the card is for "Electronic Use Only", a fancy way of saying that it's not embossed. So far, so good, right? Now things get really interesting... The card has a mileage points program, which can be used to automatically load a Suica e-money purse, which can be used at numerous public transportation systems around Japan (mainly Japan Railways) and merchants such as convenience stores and station kiosks. In the U.S., the only card that is similar is the Starbucks Duetto Card, with second purse use limited to one merchant (i.e., Starbucks). As Celent SVP Bart Narter often says, "But wait, there's more..." The card is a chip-enabled for greater security at POS and ATMs. Very importantly, the Suica e-money purse is supported by contactless technology, an absolute necessity for use at railway turnstyles during morning and evening commutes. Also, the Suica purse can be auto-loaded from the credit purse once the balance drops below a certain threshold. No such combo payment-transit card has yet to take off here in the U.S. Finally, when used at certain merchants (i.e., Japan Railways stations and agents), the card functions as a View Card, a private-label credit card which offers more favorable merchant discount rates than Visa-branded transactions. There are very few, if any viable examples of dual branded-private label cards available in the U.S. today (I do seem to recall that Brooks Brothers once co-branded a similar type of card with GE Money). All of this without an annual fee -- don't hold your breath for a U.S. equivalent.