Change card

2010-10-25

in Economics, Geek stuff, Rants

Change is annoying. Whenever I get anything smaller than a $1 coin, I dump it as soon as possible into either a big jar at home or a big jar at work. My pockets have enough holes in them already, without carrying around thin-edged metal objects.

It is no surprise that there are companies that make machines that eat change and spit out a credit for groceries, taking a fairly large commission. The other night, an idea along similar lines occurred to me: a contactless ‘change card’.

It would use the same RFID technology that credit cards are now adding. When you paid for something in cash, you would get back bills and perhaps $1 and $2 coins. The rest of the balance would get wirelessly added to your card. If they were privately deployed, the issuer would probably take some commission, but perhaps it would be worth having governments do in order to save them most of the expense and bother of making coins.

The cards would not be registered or tracked, but they would have a $10 limit. When you accumulated a balance at that level, you would need to buy small things like newspapers, coffee, or sandwiches to bring the balance down. This would be to reduce the risk of them being used for money laundering or other nefarious purposes.

The question – I suppose – is why not go whole-hog and use an entirely electronic payment system? That option is certainly already open to people, and for various reasons many people keep using cash. Giving people the opportunity to use cash without messing around with pennies, nickels, dimes, and quarters seems like a good idea.

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{ 4 comments… read them below or add one }

Ryan Nassichuk October 26, 2010 at 5:08 pm

I adore this idea, though I think a $100 limit on the cards would be more practical.

Why not go completely cash free, you ask? Because we’re already too electricity-dependent.

R.K. October 27, 2010 at 10:14 am

What is to stop somebody from a laptop and an RFID reader from going to a busy subway station and draining the balance from everybody’s change cards?

There has to be some mechanism for preventing unauthorized transactions. How do the contact-free credit cards manage this?

Casus August 29, 2011 at 7:32 pm

Capital idea, old chap. I had this exact same idea, down to the 10 dollar limit. It’s basically a cash card that isn’t tied to any one person. If you loose one, just ask for an empty one at a register, like a gift card. Convert change to it using a machine and/or get all your clutter change back on the card by swiping it at any register when you check out. Great idea. It could operate similarly to bit coins and would require a large amount of money to be purchased and put out of circulation or whatever. Basically one way of doing this is having a parallel monetary system with a 1 to 1 rate of exchange.

. April 10, 2012 at 8:48 pm

This MintChip is not a flavour of ice cream

The Royal Canadian Mint wants to get rid of pocket change — and it’s enlisting hacker types for help.

Less than a week after the government announced the penny’s impending death, the mint quietly unveiled its digital currency called MintChip.

Still in the research and development phase, MintChip will ultimately let people pay each other directly using smartphones, USB sticks, computers, tablets and clouds. The digital currency will be anonymous and good for small transactions — just like cash, the mint says.

To make sure its technology meets the gold standard in a world where digital transactions are gaining steam, the mint is holding a contest for software developers to create applications using the MintChip.

The old-fashioned prize? Solid gold wafers and coins worth about $50,000.

It’s such an unusual move for a Crown corporation that Hacker News http://news.ycombinator.com/x?fnid=7kkYqULuz2 questioned whether it was an “elaborate hoax.”

It’s not, the mint’s chief financial officer Marc Brûlé said Tuesday.

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