Ian Wylie
American Express has pipped rivals Visa and Mastercard by launching an Internet credit card in the United States, containing a fraud-busting computer chip and a free PC card-reader.
American Express claims its new “blue” card provides cardholders with the extra security they need when they are shopping on the Net.
To spare shoppers the hassle of typing in their credit card details each time they make a purchase, the blue card comes with its own “virtual wallet”: once cardholders have entered their name, address and card number into the wallet, the details are passed on automatically each time they hit the “complete purchase” button.
Yet while the blue card has a magnetic strip like other conventional cards, an embedded chip stores a unique digital certificate that acts like a key.
When swiped through a smart card reader – which connects to most PCs and is being given away free by Amex – the key unlocks the wallet, provided the user types in his or her correct personal identification number.
Other credit card issuers are exploring similar technologies, but Amex has beaten them to the punch. One company that makes card- reading devices, UTM Systems, recently announced that four US banks affiliated with Visa and Mastercard International will begin distributing the rival system free to card-holders this year.
The Amex blue card offers shoppers an extra layer of security in the form of a “fraud protection guarantee” which shields cardholders from any unauthorised charges made online with their cards.
Similarly, a “return protection guarantee” lets you return an item purchased with your card even when the retailer refuses to take it back. Amex is promising to refund cardholders by up to $300 per item, and up to $1 000 per customer per year.
A “best value guarantee” means that if, within 60 days, the card- holder sees an identical item in a printed, dated advertisement at a lower price than they originally paid, Amex will refund the difference, up to a limit of $250 per item and $1 000 per customer annually.
The blue card has its own “micro-site” on the Amex website where customers can pay their bills online and import their account details into personal finance packages such as Intuit’s Quicken and Microsoft Money.
Amex says it is spending more than $250- million a year to increase the use of its cards on the Internet. Use of Amex cards for Internet purchases has lagged compared with use of cards from competitors Visa and Mastercard – a recent report by consultant Nilson suggests 59% of Internet credit card purchases are made with Visa, 28% with Mastercard and only 12% with Amex.