Paying by credit card is about to get a little bit easier.
JPMorgan Chase & Co. on Thursday said it plans to launch a new credit card that will allow users to pay for items by simply holding the card near a terminal instead of manually swiping it, in an effort to increase the speed and convenience of card purchases.
The new card, being marketed under the name 'blink' on Chase credit cards, will come equipped with encrypted data readable by a point-of-sale terminal at the checkout counter. At the time of purchase, cardholders can place their card near the terminal, which will emit a tone confirming payment, the bank said.
Besides speeding up the payment process, the new cards are aimed at bolstering credit card sales for JPMorgan Chase, the nation's second largest financial services provider and its premier credit card issuer.
"The new card makes it easier and faster for people to pay in places where they currently use cash, like convenience stores and fast-food stores," said Thomas O'Donnell, senior vice president of Chase cards services. "If you can get them to stop using cash, that translates into more frequent credit card use and greater loyalty with customers."
Although the new cards will not require a customer signature, JPMorgan maintained they provided the same level of security as the traditional card-swiping method.
"The customer has to hold the card close to the terminal, but it stays in their possession at all times," O'Donnell said. "The card and the reader in the terminal are safe and secure, and the transaction is handled the same way that credit cards are managed today."
JPMorgan said it will start mailing out the new cards in June, first in two major U.S. cities followed by a nationwide rollout continuing into next year.
7-Eleven Inc., the world's top convenience store chain, will test the new card in 170 of its stores, while Sheetz Inc., a family-owned convenience store chain, has agreed to launch a co-branded credit card offering the new service at its 300 locations, the bank said.
Drugstore chain CVS Corp. and movie theater operator Regal Entertainment Group have also agreed to use the new cards, O'Donnell said.
JPMorgan said it plans to have thousands of merchants nationwide accepting the new cards by the end of this year.
