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Wed 2 Aug 2006 04:00 AM

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Middle East takes European lead in contactless payments

Turkey has become the first Middle Eastern country to introduce contactless payment cards getting ahead of the latest credit card payment curve not only in the region, but also Europe.

Turkey has become the first Middle Eastern country to introduce contactless payment cards getting ahead of the latest credit card payment curve not only in the region, but also Europe.

Garanti Bank, one of the largest banking groups in Turkey, is issuing 25,000 contactless credit cards, which use MasterCard PayPass technology, to its Bonus cardholders. Starbucks, Burger King and Cinebonus, Turkey's largest cinema chain, have already signed up to accept MasterCard PayPass in Turkey.

The cards, widely used in the US and Asia offer consumers an alternative to cash, but only for small ticket purchases usually under US25. Transactions are completed. Turkish consumers simply tap their new Garanti Bank MasterCard card on the PayPass reader at participating merchants to authorize a transaction. Amounts over $25 need a signature.

Ozlem Imece, general manager South East Europe, MasterCard, said: “Turkish banks have always been ahead of the curve when it comes to card payment products. Working with MasterCard, they were the first in Europe to launch virtual cards, multi-partnered co-branded cards and distribution cards. Now, they will be the first to launch MasterCard PayPass in Europe.”

The bank is said to have aggressive plans for expanding its use of the contactless card technology. By the end of the year, if the pilot is a success, the bank says it could issue contactless card to its five million-customer base. While the initial merchants are predominately global vendors, the bank is one of serves more than 170,000 merchants and so would be in a position to push the concept to a broad base of merchants.

Mehmet Sezgin, general Manager, Garanti Payment Systems, said: “We are excited to be working with MasterCard on this ground-breaking MasterCard PayPass programme. Garanti Bank is committed to staying at the forefront of payments innovation in order to provide the best possible service for our customers.”

Lebanon was also evaluating the technology prior to the Israeli attack on the country.

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