Slashdot Mirror
Cashless Society
roomisigloomis writes "France has released "en masse" a new card to replace money. No private information is stored on the card and anybody can use it. Just like cash: you lose it and someone else uses it. Do you think we could be nearing the end of life of paper money?"
In Belgium this has been available for a couple of years now. It's called Proton over here and is pretty popular.
I wonder if there will be a way to transfer money directly from one card to another, although I suppose you would need a separate machine for that.
Otherwise you could only use it at places like stores, where they would have a card reader.
Paper money has the advantage over the card because you can see how much you have without accessing that information somewhere else.
down some strippers G-String? How I ask you?
What the hell are you supposed to do when someone decides to be an ass and demagnetize your card? Does your money just vanish since you can't scan it and it carries no identifying information?
Paper money has to be carefully studied and then duplicated with painstaking attention to detail.
Someone could just probably figure out how money is "stored" and just keep on replenishing. Note the card is anonymous.
Money might not grow on trees, but it can be created by computer
i wish the article looked into how the gov't insured that evildoers are not able to illegally hack cards to increase their value (or start counterfeiting cards) ..
the article did mention card refills, so it would seem the chip on the card is (re)writable.
----
i do not use drugs, i AM drugs -- Dali
This CashCard has existed here in switzerland for several years. It is, however, largely ignored except for a few places.
The reason for that is simple and the same as why, in France, the new card is not being well accepted: It has an expensive transaction cost compared to the price of the item you purshase (think 10 centims per transaction where you would use it to buy 1 Euro items), the fact that it is far from annonymous and finally the fact that the machine you use to "load" the card is compley and damn slow to manipulate (whant to buy ? Load your credit card, punch your PIN, wait until the bank answer, withdraw your card, load your cashcard, deposit, remove cash card, load it again, buy item - about 5 minutes for the average persone).
The only place here, in Geneva, where it is commonly used is for public phones and for paying for car park. Several articales of the French TV and the words from my French friends shows that the same apply to France.
"never expires" - it does? thats not what the article says...
"never gets damaged" - all physical currency only exists in a physical and damagable form, paper rips, burns, gets washed... plastic money isn't especially sturdy and who wants to keep massive volumes of coins?
the money card would have a database (physically located in several places across the country/world) which is something physical cash cannot offer - a backup
sounds to me like this money card is just as anonymous, safe from expiry and damage than normal cash....
I don't see how this is addressed.
(1) What if the babysitter comes to my house and I owe $4.50. Do we both go to the nearest ATM to transfer onto our cards? Will I have a card swipe in my house (most probably not).
(2) The joke about lap dances someone made before my post actually rings true. How does one pay for these kinds of impromptu needs? How do I loan a friend $1 to get a bottle of pop? Do I give them my card to borrow? Would I give them my wallet? Maybe lap dancers will have card swipes strapped on
(3) What about counting your cash? Simply, how do you know how much is on your card without going to an ATM to get a readout?
(4) How do you give the kids a few dollars to shop or grab a bite? How do you give them one dollar to grab candy before the movie starts? Do you give them the entire card? Again, do you give your entire wallet / purse for a need like this?
(5) If a card gets snapped in half, then what? When a paper bill is ripped, a taped one is still legal tender. What about cards?
(6) Can someone run a bulk demagnetizer over my card and financially wipe me out? This is a serious concern, folks.
How are these simple needs addressed? I also like to think that the days of paper money are numbered -- but how are these needs met?
Maybe withdrawing all paper cash $5 and over, converting US dollar bills to a system like Canadian $1 and $2 coins for small change needs? Coins are much more convenient than paper that gets folded, spindled, mutilated, torn, etc.
Dunno about in Australia, but here in NZ we introduced polymer notes a few years ago, and they sure aint paper, damed tuff stuff - sure as hell can't tear it.
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The problem I see with these cards is that you essentially buy them from a bank.
Let's say you buy a $100 dollar card from the bank. The bank transfers $100 from YOUR account to their account from which it can be used by the bank to loan to other customers and earn interest (mortgage loans, auto loans, credit card loans, etc). So if it takes 2 months for you to use up the $100, you've "given" your capital to the bank to use for two months.
On top of the banks getting the "earning power" of your $100, they charge you to get your capital back through transaction fees! So at a minimum, the bank makes 50 cents on every card it "fills up". If it takes you two months to use the card, they get up to ~$2.00 more!
On top of all that, what happens to the money that never gets used, lost cards, broken cards, cards that have only 50 cents left on them so they get tossed into glove box. I'm sure the banks won't let go of that "unclaimed" cash without a fight.
No, I'll continue to use my ATM card that's linked to an interest bearing checking account, even though its a microscopic rate and live under the illussion that I have control of my cash.
With the card, you won't know if you have to go to the to refill it. Nobody knows exactly how much cash they have, and with a card, it's too easy to forget a few purchases and have less than you expected.
From the article:
Because the basic Moneo card is anonymous, there are no privacy or identity theft concerns.
Regardless of whether the "basic" card is anonymous, it's still clearly possible to track the card's use, and by extension, its user, who has to be identified to obtain the money to begin with.
Step 1) $100 were downloaded from John Smith's bank account to card #12345
Step 2) Card #12345 was just used to purchase $80 worth of pr0n.
Step 3) Bank sends John Smith a bunch of porn-related junk mail.
The retailer might not be able to ascertain John Smith's identity, but the bank most likely could, if it were part of the network.
And the government certainly could. Not familiar with France, but in US translate "could" as "would."
I hope someone can contradict me here. In particular, I'm wondering if there's a way to anonymize Step 1, such that: 1a) $100 is transferred from John Smith's account to a special secure escrow network which is holding money from many pending transfers. 1b) ATM 385 is given authorization to loads up a card with $100. 1c) ATM 385 loads #12345 with $100 drawn from the escrow network. 1d) After transaction is complete, all bank knows is that $100 is gone from John Smith's account and given to ATM 385. All ATM 385 remembers is that it loaded $100 onto card #12345. It doesn't remember the account it was originally taken from. Does this make sense?
There are two kinds of people: 1) those who start arrays with one and 1) those who start them with zero.
In this column, you can read what I thought about this. "About a week ago, my bank asked me if I wanted a new plastic card, named Moneo. This card would be dedicated to small purchases, like newspapers or a french baguette. My bank also asked for 10 euros per year for the card..." Personally, I don't think Moneo will be successful except if it's free. For more details, check this BusinessWeek article or the official Moneo website (in french). Roland Piquepaille.(http://radio.weblogs.com/0105910/)
As a french pro-european, I'll amazed at the short-sightedness of the various european govs in supporting those cards.
As pointed out in numerous posts, cards like this exist all over Europe... and yet, AFAIK, none are compatible.
Think about it: with the Euro, I can go in any of the 12 participating countries and pay with the same money, without any problem. With this great cool new gadget, I'm limited to a few shops in my own country. Oh, and I kinda like the euro coins, it's fun to see some from 12 different countries mixing in my pocket. This thing is just a bit of plastic. And it's expensive too.
Needless to say, I'm not getting one before I can use it all over the EU. And before it gets cheaper, as well.
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Don't know about France, but here in Belgium we have a little keychain gizmo in which to insert the card and it tells you the amount you just purchased, as well as the last couple of transactions (just the amount).
Research is what I'm doing when I don't know what I'm doing.
This was introduced in Denmark a couple of years ago, but it failed to get broad appeal.
If you want to see how to bring down the amount of cash that people have, you should have a look at the Danish "Dankort" system. It is because of that system that Denmark has the lowest amount of cash in circulation compared to the size of the economy. Personally I almost never carry any cash around.
http://www.dankort.dk/ (Danish)
The Dankort system is an online system with identity, but it has been constructed in a way that makes almost anybody able to get it. Of a population of 5 million, there are 3.3 million Dankort. If you subtract the children and the very old people, you'll find that almost anybody uses it.
Lars Dybdahl.
Since smart cards in France all incorporate a chip, their magnetic strips are rarely used. Thus, even if the strip id demagnetised, so long as the chip is OK, the card is OK too.
And hopefully, it takes more work to mess a chip up than a magnetic strip.
Though I imagine you're right for this implementation, it is possible to build a digital cash cryptosystem that is as anonymous as cash. I believe Bruce Schneier covers the basics in Applied Cryptography; we went over it in an intro cryptography course I took, and I think that was the source.
The basic system is that the bank signs individual units of value (think individual bills). You then insert your card, and it transfers several of them over, gets change if needed, etc.
For the more detailed explanation (somewhat):
You, the party desiring cash from the bank, begin a transaction to create a bill. You tell the bank the account number to take the money from, and prove you're you through whatever standard techniques. Then, you create a handful (say 10) "bills"; they're real bills, minus the bank's signature. You give them each a randomly chosen 128 bit id (128 bits is enough to avoid collisions, globaly -- but you need a good source of randomness). Then, you blind each bill with a new random number. Then, you encrypt all the bills, using a different key created only for this purpose. This extra key will be thrown away when the transaction is complete. The blinding and encryption work such that you can only recover the original text with both the key and the blinding number. The bank then chooses one bill, signs it, asks to see the blinding numbers on the other 9 and also asks for the decryption key. The bank verifies that the other bills are valid, and can assume the tenth is too. They sign it and return it to you. You decrypt it and deblind it. The math works such that the banks signature is still intact. Basically, using RSA, encryption and decryption are exponentiation, and blinding is multiplication (all done modulo the key).
The bank has now signed your bill as being worth money, without knowing the id number on the bill.
This system is rather complicated, and it is unlikely something equivalent has been implemented in this case. But it is possible to do it right (just hard). I've simpleified a little, but the major pieces are there.
All of Australia's banknotes are made out of plastic. Which gives them the advantage of last a sodding long time...
:) Granted, $5s last a lot less, but it's still a whole lot better than paper (cotton pulp) notes.
:)
Australians or anyone with them.. the first two digits of the serial number are the year of manufacture. I have a $20 made in 1994 and another from 1998. I jut got some 2002 date $20s.. ei, they only need to print new $20s every 4 years
Of course, they spring around like no-body's business and are absolutely frictionless, but the concept is so cool!
Pictures at -> http://theducks.org/notes
Seriously though, this is just silly. By now everyone has heard of 'Debit Cards' and I would think that a fair number of /.ers have paypal mastercard debit cards.
Well guess what?
Canada has been there for years.
4 out of 5 stores (or in a mall, every store) has Interacmachines. Direct debit, pin protected, and ANY bank card on the interac network works on it. That is every major bank in Canada, almost all the little ones, plus most credit unions.
Explain how a pin protected card (which is cancelable by phone) is better than this 'new' french system? I mean, their system is just basically a revamp of european phone cards.
The only benefits the french system has over Interac is anonymity - As for that, we do still have cash for that, or in the case of a true cashless society, just trade in precious minerals. (eg, gold.)
By the way, Interac direct payment has been rolled out since `94
Desperation is a stinky cologne
We have these here in Germany too called "Geld Karte" (Cash/Money Card). They are mostly embraced by the Sparkasse, while most of the major private banks are reluctant to give them to you.
They are used for some aplications and there talk to add an age authentication system too them for the purpose of proving you age to cigarette vending machines. There is also talk to intengrate Crypto functionality so that you may digitally sign documents with them.
However in my mind the killer app would be to be able to use them cheaply for micro payments on the internet.
However to be widely accetable these would have to:
a) Be secure virtually - no electronic counterfitting
b) Be anonymous - Imagine Grandma giving the kids some money triggering an automatic I.R.S. audit. Let that happen once and they are out of buisiness
c) Be cheap. Real money is not for free either since there is considerable labor involved in handing out the money, accounting for the cash and buisiness has to buy insurance against theft.
d) Hardware has to be cheap too. By law the electronic signature has been available for years how every no one is using it since the cost of hardware is just too high. However with a cheap mass market reader there is no reason why this should no become as widely available as floppy drives are now (Sorry Mac Fans no pun intended). By the way as if did read that there is nothing TCPA can do which can't be done with a smart card reader, accept selling new hardware since smart card readers can be bought as an upgrade...
Currently there is one big drawback in all of these systems: All of them require the end user to bear most of the cost of deploying them (they have to pay for the class 3 reader and the smartcard), while buisiness saves a lot of money because processing is way cheaper.
A system similar to this was rolled out here in Sweden a couple of years ago - CASH as it is aptly named. Now, about 4 years later, it's all but dead since nobody thought it was a good idea. As far as I can see, the only thing people use these cards for these days is parking meters.
I think it failed here because of a few simple reasons. People here were actually smart enough to see that a major reason for the banks to try this approach is for them to make more money without any benefit to the customer. Doesn't it sound like a banker's dream? I can hear the banker's going:
- I've got a great idea! We'll make our customers keep all their money - including their cash - in our bank, but we won't pay them any interest on that "CASH"-card.
- Sweet! And why don't we charge them a small fee to obtain the card in the first place?
- They won't know what hit them!
Sure, it sounds great with a cash-less society, but until the system is free to use and has all the advantages of cash, it just won't catch on.
The anonymity of cash is attractive, definitely. And it's current durability is impressive, and in most countries guaranteed. But really, it's a pain in the ass. You have to finger through your wallet for the right notes and then you invariably receive a bunch of coins that you don't want to carry around.
Wouldn't it be mcuh easier to swipe some card that doesn't require a PIN, doesn't contain any personal info, is as tough as your VISA and doesn't require a phone/data call to some central service?
The database part sounds an awful lot like it could be used to trace transactions - thus not making it ideal when you want to pay off illegal labour, buy a car under the table to get away from state tax, or convert those drug millions you made on the street into something mroe useful than an e-card to you (i.e. a house, gold, bearer bonds).
e-cash will never take off until people can be 100% sure they can use it in dubious (viewed more or less illegal by the state) activities - like tax evasion, black labour, illegal gambling, drugs, etc.
Money still seems like a safer bet since it can't be backtracked - for a system like this to work they need to be able to see and check the transaction history (lest a Slashdotter will crack the card and start making his own money - thus they need to be able to check and verify all transactions so no "creative" money has arrived on the card).
Civilization is the process of setting man free from men.
We have had a similar system in Switzerland for several years now (about ten, maybe a bit less), which is simply called "Cash".
I think it comes more or less standard with all bank cards, and it's free (techincally; maybe the bank charges for it as part of its general services, but the name "Cash" doesn't appear on my invoices.
I've been using extensively for the past year, and while it has some definite advantages, I don't see that replacing paper money for quite a while.
The good side:
- It's fairly easy to use; put it into a Cash-aware ATM (most are), transfer up to CHF 200 (ca. USD 150), and then insert it into a Cash-aware machine, hit "OK" and you've paid.
- No need to have the exact change anymore; very convenient for bus tickets.
The bad side:
- Not many places are Cash-aware: bus ticket machines are, some shops are (newsstands, for example), and that's about it...
- If someone steals my bank card, he or she can empty the card's Cash without any control; but since the amount is, at most, CHF 200 and there is only so many bus tickets one can buy, it's not that big a problem; besides, it works the same with paper money...
- Although quite fast, the system is not instantaneous: transactions can take up to 10-20 seconds; that's fast, except when the bus doesn't wait...
- As far as I know, the different national electronic cash systems are not intercompatible; hence, what works in Switzerland will probably not work with the French "Moneo" or Belgian "Proton".
All things said, it's quite convenient for small purchases and bus tickets, especially the "no exact change necessary" part. but it's still quite limited. Don't expect "Cash"- or "Moneo"-like systems to completely replace your paper-and-nickel money any time soon.
Stéphane "Alias" Gallay
Now, where did I put this witty quote?..
For smart-cards, the most up-to-date information about how much money do you have in it sits in the card itself:
If you loose your card you loose the money you have in it. Whoever finds the card can use the money in it. (just like cash)
Also if you damage the chip in the card you loose the money in it. Same as if you burn some dollar bills:
1: Secure chip cards.
2: Public key cryptography. This post assumes you know the basic concepts.
IIRC the protocol works (roughly) like this.
- Card 1 says "I am a genuine card. Here is my public key and a certificate for that key issued by the bank."
- Card 2 says "I accept your certificate. I am also a genuine card. Here is my public key and certificate."
- Card 1 says "I have decremented my cash register by $5. Please increment your cash register by $5. Signed: Card 1."
- Card 2 says "OK."
This transfers $5 from card 1 to card 2.Step 3 is the critical one. If that message gets lost then the $5 is lost as well. Of course a real protocol will include nonces and resends so that a single lost bit won't destroy your money.
This has applications beyond just replacing cash. People have been looking for a way of making small transactions over the net for years. These cards are potentially it. Plug a card reader into your USB port, put a similar one on a server somewhere, and you can purchase information off the server, paying by the page if you want. Conventional credit card transactions have high fixed costs. The costs on these cards are very low.
(Actually the server will probably have a PCI card with a high-speed, high-capacity version of the chip. But the principle is the same).
On security, PKC is the easy bit. Securing chip cards is much harder. If you can spoof a card into accepting messages from something other than a real card then you can forge money untraceably. To do this you either have to extract the private key from a card or find some other way to increment its cash register. Both of these need tamper-proof cards. The techniques for doing this are too many to go into here, but you need to worry about power supply signalling information about the processes going on in the cards, and random errors induced by putting the card in a microwave oven (no, I'm not kidding) giving information away too, in addition to raw physical attacks like stripping off the plastic and using very fine patch leads.
The biggest weakness is that any card is potentially an entry point to destabilise the entire system. I suspect this is the real reason for the $107 limit: cracking a single card would give you as an individual considerable wealth, but moving that wealth into the rest of the financial system by (e.g.) depositing it at a bank would show up in odd deposit patterns long before you could "forge" enough money to destabilise the economy. Also the individual who does this has every incentive to keep it quiet: not only has s/he committed a crime, but everyone in the know is a potential blackmailer.
Of course someone might find an easy crack and publish it. This is probably the worst case scenario. The only solution is to recall the cards and go back to cash until the problem can be sorted out. Again, the card limit helps put an upper limit on the cost of this.
Paul.
You are lost in a twisty maze of little standards, all different.
OK, so here's the rundown on it.
Postings belong to one of these categories:
a. Parochial bum
Std posting: " Here in Upper Slobbovia (or Ruritania, or whatever) we used this for well-nigh seven centuries, but not everybody(or everybody) uses it".
b. Yank yokel
Std posting: "How can it work if it doesn't do a central DB query every time? What if the DB is down? [after the slammer crashing of the Bank Of America ATM network]" (Because of the very primitive US banking system, yank yokels believe that the rest of the planet is as backward as they are).
c. Turbonerd
Std posting: "Goodness, in order to work properly and be anonymous one has obviously to do a QCM triple encoding for every non-null challenge in any transaction. You see?"
d. Impatient twit
Std posting (by the 300th time that somebody wonders how can you know how much money you have left on the card): " We have this device, see, where you put the bloody card and it will tell you how much bloody cash you have still left".
e. Know-it-all clown
Std posting: this one...
As a result, I don't know anything I didn't know before. I only know now that we live in a far more parochial and chauvinist world than I previously thought...
And yes, I live in Belgium and I have used the useless stupid thing which increases banks' profits zillions of time...
Thufir Hawat
Part-time Mentat
I'm the writer of the parent post, which is currently rated highly but is nevertheless quite wrong in its description of the implementation of the procedure. Others have corrected my misunderstanding, which, if I'm not still mistaken, goes something like this:
Step 1) $100 are downloaded from John Smith's bank account to user card #U12345.
Step 2) Smith approaches Adult Store merchant with $80 worth of embarrassingly large and bumpy sex toys.
Step 3) User Card #U12345 securely transfers $80 to Merchant Card. This transaction takes place off of a network.
Step 4) Smith walks away with sex toys in black plastic bag. Bag later breaks on the bus, contents come spilling out.
Step 5) Merchant subseqently uploads large sum of money (including Smith's $80) to bank. Bank is unaware of original sources of money.
It's the fact that Step 3 takes place without authorization from a central network which makes this anonymous and potentially superior to a regular debit card transaction.
Please "securely transfer" my mod points from the parent post to this one. Thanx!
I'm wondering about other form factors now. Would it be more practical to have a user "card" in the form of one of those keychain thingies? Or perhaps a bracelet with a tiny dongle that plugs into the merchant's reader. Further, the user ought to be able to require mandatory PIN usage on his/her card. It won't help if the card is lost, but at least no-one else could profit from your misfortune. Put your name and phone number on the card and it might actually be returned to you. Finally, what's to stop this anonymous transaction from being the basis of a money laundering scheme? And if there is nothing preventing it, what are the odds that this would be allowable in the US?
There are two kinds of people: 1) those who start arrays with one and 1) those who start them with zero.