SMART CARDS GET BIG PUSH; MASTERCARD, MAJOR HIGH-TECH FIRMS SET COMMON TECHNICAL STANDARDS.

Byline: David E. Kalish Associated Press 

In a global push to make ``smart cards'' practical as electronic money, MasterCard International Inc. and seven major high-tech companies agreed Thursday to a set of common technical standards for the cards.

The companies aim to create a worldwide standard for making the all-in-one plastic devices, which look like credit cards but contain electronic chips that store information, such as remaining available cash for purchases.

If a single standard is embraced, developers presumably will be encouraged to make a wide range of software, enabling people to use the cards for paying for everything from groceries to phone calls to airline tickets.

The group's members hailed their agreement as a breakthrough that would spur major U.S. banks to start offering smart cards to Americans by April 1998, finally making the much-discussed cards a reality. So far, the cards are only in a small number of test projects in the United States, though they are catching on in Europe.

But the conspicuous absence of MasterCard's biggest rivals - Visa International and American Express Co. - from the alliance muddied the outlook. Visa and Amex are working on their own projects. And with all sorts of credit and debit cards already in wide use in the United States, banks are wary about buying equipment for processing smart-card transactions.

Nevertheless, group members said their agreement was the first of its kind, with other competitors focusing mostly on ``proprietary'' technology that doesn't encourage broad-scale software development.

``We think it's the most significant breakthrough in the smart-card industry that we can think of,'' said Barry Hochfield, senior manager of card operating systems for Mondex International Ltd., a London-based software company that is 51 percent owned by MasterCard.

The other companies signing on to the agreement are Motorola Inc., a Schaumburg, Ill.-based maker of microprocessors for smart cards; Keycorp Ltd. of Australia; Hitachi Ltd. and Dai Nippon Printing Co. Ltd. of Japan; Siemens AG of Germany; and Gemplus of France.

MasterCard plans to move its customers, who have about 400 million MasterCards, gradually to chip-bearing smart cards as they catch on in popularity. Smart cards also can be used for credit transactions.

``We expect to see an enthusiastic uptake throughout 1998, not only in financial services but outside that industry as well,'' said Henry Mundt, executive vice president of the Purchase, N.Y.-based company.

CAPTION(S):

Box, Drawing

Box/Drawing: (Color) SMART CARD

Source: Mastercard

Associated Press