CAMBRIDGE, Mass. — The $219 million Harvard University Employees Credit Union has become the first CU in the country to issue debit cards with PayPass, MasterCard's contactless card technology.
MasterCard said that as of the second quarter of 2007, there were more than 16 million PayPass cards and devices in use at more than 55,000 merchant locations worldwide, including Fenway Park and numerous quick-serve restaurants, caf?(C)s, pharmacies, retail establishments and convenience stores in the vicinity of Harvard University.
"We are proud to be the first credit union to offer this innovative payment functionality to our cardholders," said Jim Lawrence, retail operations administrator for Harvard University Employees Credit Union. "We are always looking for ways to better serve our members, and the speed and convenience offered by PayPass fits that ambition precisely."
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To make a purchase using a PayPass card, users merely need to tap their card on the contactless payment reader at the checkout of participating retail locations. For purchases below $25, no signatures are required, further speeding up the checkout process.
Lawrence added that the CU had had some inquires about the new technology from its members but had decided to go forward with issuing a contactless card because the CU had a reputation for staking out a leadership role in technology.
"Cambridge is a pretty competitive market for us and we have always tried to give our technologically savvy members another reason to stay with us," Lawrence explained.
The CU had surveyed the Cambridge market and determined that there were enough locations in Cambridge to justify issuing the cards. "It was a bit of a chicken and egg thing but we determined there was enough space in this market to justify starting to issue."
Lawrence said that members getting new or replacement debit cards would receive one of the contactless cards but that the CU was still working with its processor and card manufacturer on the mechanics of handling reissues. HUECU wanted to spare as many members as possible the problems associate with new card numbers, Lawrence said.
Another reason the CU wanted to start issuing contactless is because it opened up its field of membership to Harvard student two years ago and Lawrence said the CU's research indicated that they would favor the move. He also said the contactless cards were marginally more expensive to issue than the others but expected that the price would drop as they became more common.
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