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Is Coin the one payment card to rule them all?

J.D. Sartain | Feb. 3, 2014
In an era when consumers' wallets are filled with credit cards, rewards cards, gift cards and other cards, Coin aims to be the universal payment option of choice. But can it stand out in a growing market of smartphone apps, digital wallets and NFC technology?

"Coin uses the concept of a leash. If your Coin gets too far away from you, it notifies you via the app that you left your device behind," Coin CEO Kanishk Parashar says. The device then locks itself; the card can be swiped but is otherwise disabled until it's back in your hands.

"If the phone battery dies or you're in airplane mode, the leash will also break," Parashar says. "But once this happens, users can manually unlock Coin using a single-button pass code (similar to a Morse code) and continue to use their Coin without their phone."

Coin can "comfortably communicate" with a phone within a 25-foot range, Parashar says. When it exceeds this distance, it starts a countdown to automatically deactivate itself if it does not reestablish communication with the phone within the period of time configured in the mobile app.

David Monahan, a senior analyst with Enterprise Management Associates — who participated in an email Q&A with Parashar for the purposes of this article — says he'd like to see the proximity loss to be farther than the proximity lock.

At a restaurant, for example, a lock setting of five feet would ensure that a server holding your Coin device can't "mess with it," but a loss setting of 25 feet would let the server reach the point of sale terminal without the card going off. In addition, Monahan says he's hoping for a tamper-resistant case such that incursions or cracks "won't erase the [encryption] keys or, at a minimum, make them inaccessible by the program."

Christophe Uzureau, research vice president of banking and investments at Gartner, describes the lost and found feature as "an interesting contribution to reassuring some cardholders," adding, "The approach to improve the tracking of payment instruments (cards) via smarphone is a feature that could generate new thinking for established stakeholders. Consumers — especially in the United States - are relatively aware of the liability with credit card solutions."

However, Uzureau says, Coin does present some valid concerns. Consumers' perceptions of security could be negatively impacted by a lack of familiarity with the Coin brand and the need to carry another piece of hardware, he says. In addition, customers must plug use a dongle into their smartphones to register their cards; some consumers already perceive dongles as insecure, and this may counterbalance the added security of the lost and found feature.

Coin's EMV Support, and International Usage, In the Works
Coin is currently available for iOS and Android; Windows Phone and BlackBerry options may be offered if there's user demand, the company says. The battery lasts two years; as of now, there's no rechargeable option.


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