Product: ExpressPay

Company: American Express Co.

American Express Co., although founded more than 150 years ago, is no stranger to cutting edge technologies. The company introduced the industry's first plastic charge card in 1959; in 1972, it issued the U.S.'s first magnetic stripe card; and in 1999, it introduced Blue, a national smart card program. Anticipating the next evolution in payments, AmEx is currently testing a contactless payment program called ExpressPay.

ExpressPay comes in the form of a smart card-enabled key chain attachment, a.k.a. a fob. The device uses radio frequency technology (RFID) to authorize and process payments at the point of sale. All data is encrypted and gets transmitted through a wireless connection in a matter of seconds from a contactless reader to a POS terminal.

Contactless payments are intended to be used where transaction speed and customer convenience are a matter of necessity such as quick service restaurants, gas stations, convenience stores and company cafeterias. Consumers don't have to pull anything out of their wallet to pay for goods, and their signature is not required.

AmEx began testing ExpressPay during the summer of 2002-initially with some of its employees in Phoenix and then later with customers at a cafeteria in an office building in Jersey City, NJ.

AmEx recently announced that it's extending the pilot first to 4,000 users (mostly employees of the company) and 175 merchants in the Phoenix metro area, with additional plans to expand the program to include up to 30,000 people over the next six months.Carl's Jr., Dairy Queen, Kwik Kopy Printing, Quiznos Sub and Schlotzsky's Deli are some of the merchants participating in the test.

Results so far have shown that spending from customers using ExpressPay increases 20-30% and transaction times decrease 20-40%.

AmEx offers two types of payment programs through ExpressPay: ExpressPay Direct Link, which links to any consumer AmEx charge or credit card and ExpressPay Pre-Loaded, which can be prepaid on any major credit, charge or debit card.

To protect consumers, ExpressPay has daily spending limits and customers will not be held liable in the event of fraudulent charges. The company also has a Web site that allows users to track their purchases.

American Express Co.

200 Vesey Street

New York, NY 10285

212-640-2000

www.americanexpress.com