October 9, 1995. Copyright, 1995, Graphic News. All rights reserved

VISA ON THE HIGHWAY TO A CASHLESS SOCIETY
By Nicholas Booth, Science Editor

LONDON, October 9, Graphic News Ñ The information superhighway is rarely out of the news these days. If it isn't your local pub advertising its wares, or the Labour Party wanting every school, library or hospital to have free access, then perhaps it's some relative or friend talking about the invisible network crisscrossing the globe. But few people realise that there is in existence a smaller, privately-owned network which has already revolutionised shopping all over the world - from Samarkand to San Sebastian, if not Portsmouth to Punta Arenas.

If you have a credit card you may already have used it, perhaps unknowingly, for this network has been set up by Visa International. The VisaNet system is much more powerful and efficient than the Internet and can authorise a transaction in less time than it takes to read this sentence. It employs nine million miles of fibre optic cables, equivalent to wrapping the Earth 375 times. The heart of the system involves two computer "supercentres" in Basingstoke and McLean, Virginia which operate IBM mainframe computers. They are each capable of storing the equivalent of 100,000 sets of the Encyclopedia Britannica.

VisaNet is used to provide on-line authorisation, automated clearing and settlement for the 19,000 financial institutions which issue Visa cards and between them handle some 6.75 billion transactions every year. That translates to 80 transactions per second, ultimately controlled by the central computers via the VisaNet. Consumer credit usage is voracious, and by the turn of the century, Visa estimates that 15 billion transactions will be taking place each year.

Having its own dedicated Network allows Visa International to increase the speed and simplicity of its transactions, as well as reducing time wasted on questionable transactions. In just a few seconds, the network checks on the validity of the card, whether it has been reported lost or stolen or whether there is enough credit available for that transaction. And security is ensured because Visa set up the system itself rather than depend on other operators' phone lines. The reason for the two "supercentres" is in the unlikely event that if one computer crashed, the other would still work and keep the network operating.

For the future, Visa is keen to embrace new technology to bring us one step closer to the cashless society. Visa International is sponsoring next year's Olympic Games in Atlanta and plans to introduce into wide circulation its version of an electronic purse Ð a credit card with security data stored in a microchip embedded in the card. Already, these "smart cards" which do not require authorisations or signatures are being tested on a regional basis around the world. Next summer, Visa International expects that more than 5,000 merchants will accept the cards to coincide with the launch of the Olympics. 

Sources: VisaNet, Financial Times, Guardian OnLine