Marianne Lebeau opens her purse to pay for a pain au raisin at
Au Pain Quotidien bakery in Brussels' chic Place du Sablons. But she
doesn't take out any coins.
Instead she hands over a Proton card. Unlike traditional
magnetic- strip credit cards, Proton stores Belgian francs on a
silicon chip, making it perfect for small purchases such as
newspapers, chocolates, and even croissants and baguettes. There is
no minimum purchase.
"This card's much easier than coins," says Ms. Lebeau. Like
digital mobile phones, electronic money represents another
of the future in which Europe has a chance to trump Silicon Valley.
Early failures in the US
A Frenchman developed the first smart cards, European governments
have pushed the technology, and high telephone costs provide an
incentive to supplement regular credit cards. The transition to the
euro increases the chance for e-purses to replace bulky notes and
To succeed, however, Europe's card issuers and those businesses
who accept them must first agree on a common standard that will work
In the US, electronic cash has flunked its initial tests.
Citibank and Chase Manhattan Bank last month shut down their initial
trial of the technology on Manhattan's Upper West Side. The problem:
Not enough customers used the cards for merchants to invest in it
not enough merchants accepted the card for customers to be
"We think smart cards will work best in the US in specific
controlled situations" such as hospital security cards, highway toll
passes, and college-campus payment schemes, says Glenn Weiner,
American Express's vice president for new technologies in New York.
In contrast, little Belgium was able to get 60 of the country's
banks to work together and push the cards to clients. Customers now
can "recharge" their e-purses at any bank branch and use them at
"We were not created by ... technical companies, but by actors in
the market," says Armand Linkens, Proton World's managing director
Brussels. The government in Brussels accelerated the early momentum
by converting parking meters to accept the e-money.
Since the launch two years ago, more than 30 million Proton
purchases have been made in this country of only 10 million
inhabitants - the highest percentage in the world.
Now Proton is going global. It has aggressively marketed its
technology and sold licenses to 15 countries. Over the summer, both
Visa and American Express took shareholdings in Proton World
"Proton is the world's leading e-purse and we want to take it to
the next level," explains American Express's Mr. Weiner. "Our
customers should be able to use their card anytime, anywhere, for
type of purchase."
The euro opens a large window of opportunity to replace cash.
While the Continent moves to the single currency on Jan. 1, euro
coins and notes won't be introduced until 2002. In the meantime, e-
purses full of euros would allow a convenient solution. …