HSBC Group’s U.S. banking unit today announced that it has begun replacing its existing customers’ debit cards with new cards embedded with MasterCard’s PayPass contactless chip technology. HSBC USA plans to issue more than 1 million existing and new consumer debit cards by year end and will eventually reissue new cards to its nearly 3 million debit card customers. HSBC USA joins the ranks of Citibank, KeyBank and JPMorgan Chase in offering payment devices embedded with RFID chips that communicate with RFID-equipped terminals at the point of sale.
Card issuers in the U.S. seem to be realizing that payment vehicles using the PayPass technology can provide them with a means to not only differentiate their products but to position themselves as pioneers in the soon-to-be competitive contactless payment industry.
HSBC will educate its customers about the benefits and use of the smart cards though accompanying mailings. Future marketing tie-ins with MasterCard to promote HSBC smart cards and PayPass are planned.
Meanwhile, HSBC is in good company. To date, Chase has issued more than 2 million of its blink-branded contactless Visa and MasterCard credit cards. KeyBank, which is currently replacing its existing consumer, small business and KeyMiles reward debit cards, plans to issue 2 million cards within six months. What’s more, Citibank recently announced it, too, would issue a contactless payment vehicle, opting for a chip-embedded key fob device that works as a companion to Citibank’s customers’ debit cards. Citi is rolling out the program with 2.5 million consumers this fall.