Retailing THE
Chipcard
4
new products
WHAT'S NewS Issue 10 October 1996
Ever since the days of the Medici and the other merchant princes of
Renaissance Italy, banking has been built on a network of essential
relationships. However, advanced information technology is now
radically reconfiguring the context in which those networked
relationships are defined and cultivated.
AHOLD GAAT
VOOR DE
CHIPKNIP
Een belangrijke stap
voorwaarts in de stijd met de 'Chipper'van
de Postbank is genomen. Het Ahold concern
gaat met onze bank in zee. De 'Chipknip'
automaten zullen bij de concern
onderdelen Albert Heijn, Etos, De Tuinen,
Gall Gall en Jamin geplaatst worden. De
ca. 1.000 winkels die hiertoe behoren zullen
nog voor het eind van dit jaar over een
betaalautomaat kunnen beschikken.
CHAIN OUTLETS
The Chipknip technical
Standard recently gained a Chipping away at new business - Steven SpiekhoutHanneke van Berckel
potentially decisive ally and Nicole van Puel.
following the conclusion of a trend-setting
deal between Rabobank and Ahold, a
leading food retailer with extensive
interests in both the Netherlands and the
US. Ahold owns the Dutch market-leading
Albert Heijn supermarket network. lts
speciality stores includes pharmacists Etos
and De Tuinen, the drinks retailer Gall
Gall, and the Jamin candy shops chain.
These speciality stores have allied with
Rabobank for an initial period of 3 years,
and the entire Ahold group has thus been
firmly brought within the Chipknip sphere
of influence.
WIRED FOR XMAS
'These particular Ahold chains have a total
of about 1,000 stores throughout the
Netherlands,' remarks Hanneke van
Berckel, one of the account managers who
helped engineer the deal. 'At least five
Ahold-affiliated stores have a presence on
the high street of every sizable Dutch
town. With these shops all using Chipknip,
it may well be hard for other retailers to
resist.' To consolidate the potential
advantage of this fledgling network, the
Indeed, the move towards fully electronic
payments systems wil! shape the very
future of banking itself. More and more,
the challenge of a contemporary bank is to
position itself on an electronic crossroad -
to facilitate a digital connection - between
its retail customers and its network of
corporate clients.
DIGITAL CURRENCY
Consumers the world over will soon be
using plastic cards embedded with highly
capable electronic chips that will facilitate
all their monetary transactions. As the old
cash-based market breaks apart, and a new
system based on digital currency begins to
take shape, the inevitable rivalries over
control of networks and new markets is
already underway.
partners aim to have Ahold's shops fully
wired before the December shopping
season begins. This challenge will require
substantial investments and speedy systems
integration on the part of both the retailers
and banks.
SUBSTANTIAL SPIN-OFFS
Because the Ahold speciality shops have a
combined annual turnover of some NLG
1.5 billion - and an important part of the
recent deal involves Rabobank managing
their electronic payments traffic - this will
bring additional income in the form of
fees. Potentially more significant even than
the fees in the long term, of course, are the
wider advantages implicit in a relationship
with an important new corporate cliënt.
This will bring the possibility of substantial
spin-off business in other fields such as
corporate banking as well.
ONLYTHE START
The explosive potential of electronic chip
cards is in its infancy. Significantly, Visa
International recently studied and adoptei^
the Chipknip system for use on the pan-
European market, suggesting that it may
soon enjoy a substantially wider base.
'Superficially, the Chipknip
doesn't look much different
than a regular credit card,'
remarks Steven Spiekhout of
corporate banking who
heads up the Ahold team.
'The closer you get,
however, the better it looks.
It won't be long before we
live in a world where there
is one card for every
customer - and that card
will be the focal point of all
their financial activity. Our
job is to make sure that we
stand firmly in the centre
and facilitate that all-
important connection
between retail customer and
our corporate cliënt. The
Ahold deal is only the start.'
MULTI-FUNCTION AL
In Holland, there are two rival electronic
chip card standards. One, called Chipknip,
is supported by Rabobank as well as ABN
Amro, plus such corporate heavyweights
as Royal Dutch Shell. A second, known as
Chipper, is being promoted by the
Postbank and KPN, the
recently privatized PTT.
The Chipknip cards have
been carefully designed so
that they can handle tasks
ranging from positive
identification of the
customer, registration of
the transaction, and
clearing of eventual
payments. What's more,
they support 'frequent
flyer' and other customer
loyalty schemes that have
been inaugurated by
retailers already.
