US retailer Target is to scrap the use of chip technology in its Visa card loyalty programme, dealing a blow to US proponents of smart card technology.
Target's adoption of Visa chip cards in 2001 was hailed as a major breakthrough in the use of smart cards in the US. Consumers could use the cards to download shopping coupons from the Internet or instore kiosks for redemption at the point-of-sale.
Target says it is abandoning the programme due to limited customer uptake. The retailer has told its smart card software vendor Catuity that it will be phasing out the coupon programme over the next twelve months.
Analysts believe the move is likely to slow adoption of the technology by other retailers, although the emergence of more user-friendly and ubiquitious contactless chip payment cards may yet be a catalyst in this sector.