Mondex was the name of an e-purse payment product, (or SVC = Stored Value Card) used for storing and using Electronic Cash. The scheme was designed to be a total cash replacement, and included electronic cash payment, deposit, and person to person transfers. The Mondex cash purse, was especially useful in facilitating small, day to day purchases. Mondex was launched in a public trial in Swindon UK in July 5th.1995. But 4 years of product development and internal field trials had led to this public trial.
The idea, conceived in 1990, was the brain-child of two employees from the National Westminster Bank (NatWest) Tim Jones, and Graham Higgins. Others were instrumental in invention and development such as David Everett, and Ian Simmons, who helped provide many of the cards displayed in the refence collection.
Mondex cards UK
How it worked
Mondex cards emulated physical cash. The cardholder downloaded, using an ATM, (or an actual bank teller) an amount of cash from a linked current account. Merchants who had the Mondex POS terminals installed would accept payments from the inserted card. The merchant also had a card inside the POS terminal, known now, as a PSAM (Purse Secure Access Module). The PSAM looks physically similar to GSM cards for mobile phones.
The purchase amount would be deducted from the customer's card, and deposited to the Merchant card inside the terminal, much like a normal cash till. At end of day, the merchant could deposit the day's takings at a Mondex enabled ATM to their linked merchant bank account.
The huge advantages of this process are, the elimination of the cost of handling, counting cash, and especially the lowered security risk of large amounts of cash in transit.
The whole commercial process here was a closed loop, from customer bank withdrawal, purchase, to Merchant deposit. Clean and streamlined. The system worked!
The first FIELD TRIAL of the product, beginning in March 1992, was called "Byte Card" This name was reportedly chosen because of the association with computing, and eating. (haha) Please watch the following VIDEO of the original Byte card film publicity.
Take a Byte VIDEO
The first issued customer cards, and test cards were all Gemplus Re-loadable cards. On some of the early white test Byte cards we see a sticker with "Volga Test card". This was the early project name, before the "Byte card" name was coined. Pictured below is a VOLGA test card loaded with 1000 GBP, and another re-named Byte2. A number of different white test cards were also used for Swindon, but the Swindon test cards had the second generation Hitachi chip.
A few of the early test cards are DATED from December 1991 through January 1992. Test cards were designated as FIXED or MOBILE, and MEMBER, as well as CUSTOMER card or SUPERVISOR card. Some were even designated as SIM. (function = PSAM) These early testing cards were loaded with 50 pence up to a million pounds. (mvl abbreviation= Maximum Value?)
Other test cards were made for NCR Byte TILL development (ATMs), designed to facilitate loading of cards from the customer account, and to check the card cash balance. The Byte tills had 2 card slots, one for your regular banking card, and another for the Byte card.
The Byte trial went live in March 1992, and 6 striking designs were supplied by Gemplus incorporating a 2K EEPROM chip.
The Customer card showed a picture of the Data facility at Goodmans Fields. These were the cards issued to employees participating in the trial.
5 specific Merchant card designs were supplied for the various facilities. These cards are the recipient cards (PSAM) for customer purchases, and would either be FIXED inside the Till devices, or MOBILE to do "end of day" transfers to the Merchant account.
1. Scheme card GREEN
2. Retailer (Merchant) card YELLOW
3. Catering department card RED (restaurants and cafeteria TILL)
4. Office and Cash Bar BLUE (Cash Bar was the manned TELLER station for loading cards)
5. Bank Dispenser card PURPLE (ATM Byte Till)
Follow the top link button to see all 5 merchant cards in the reference collection.
Here we can show some early Byte card publicity for the Goodmans fields Centre. (Thanks Chris P)
As testing continued at Goodmans Fields, the card transaction response time, and chip security encryption, became the priorities for improvement. The Natwest Development team (NWDT) came to the decision that the currently available card technology did not meet the needs of the project. Hitachi in Japan, were approached to form a team, specifically to develop a highly secure and responsive chip. Something that could meet the future needs of Chip card banking.
Byte card 2
As early as 1993, the Byte 2 card, with more advanced Hitachi chip interface, (using M-1 operating system) were being issued to the Goodmans Fields Data centre staff. Overall, Natwest issued approximately 6000 cards to employees within the centre. The initial first issue quantity of BYTE1 was 100 cards, and by September 1993, approximately 5000 cards (Byte1 and Byte2) had been issued. The Byte2 customer card was a new design, and the same 5 coloured Merchant cards were also issued. Early Byte cards did not have code numbers, but later Byte1 customer cards were issued with 999999 code followed by serial number. The 999999 code continued to be used on Byte2, including some of the merchant cards, but these codes were replaced with 6 digit bank codes for Natwest and Midland bank customers during 1993.
Natwest bank code 493688
Midland bank code 490388
Employees and some local workers could pay for meals, or refreshments, at 2 restaurants, plus shops and coffee lounges. Cards were issued free to staff, and could be topped up to £50 at the local branch (Cash Bar) or at a small number of Byte enabled in-house ATMs in the centre. Staff inserted their normal account card into the ATM first (using PIN number) and prompted to insert the Byte card into a second slot, and the selected amount would be transferred to the Byte card instead of notes being dispensed.
In December of 1993, Midland bank (now part of HSBC) joined the scheme as a partner, to run the first PUBLIC trial of the developing technology. (in the city of Swindon) The expanded card scheme was named MONDEX. The NWDT began to develop or commission the manufacture of many merchant devices needed for the project. These were Payment terminals, ATMs, parking terminals, public transport on buses and public Payphones too, all enabling Mondex card payments.
The Swindon trial was jointly sponsored by NatWest, Midland Bank (including other HSBC banks like First Direct) and British Telecom (BT). Mondex International, was formed to own and manage the Mondex scheme. The Byte card was replaced by Mondex with new Logo (on centre card above) This organization would begin to recruit international banks to launch pilot programs within their own territories, and with the local currency.
The Swindon trial launched on 5th July 1995. Adapted ATMs were deployed, as well as Mondex enabled payphones developed and supplied by BT. BT also produced home phones with Mondex functions, and we can show the BT archive photos of these phones. (Thanks Philip) We are looking for the BT test card for the reference collection.
A number of international financial organisations became stakeholders in Mondex International and went on the launch their own trials of the product. This came to include Mastercard. As a major shareholder, Mastercard influenced a change in Logo reflecting the joined circles enclosing the name Mondex (3rd card at the top of this article)
Natwest also conducted Mondex trials in UK, at universities of Exeter, York, Nottingham, Aston and Edinburgh. Abroad, Mondex trials included Guelph in Canada, New York, San Jose, Costa Rica, Shah Tin in Hong Kong, Mexico, Norway, Taiwan, and Israel. Initiatives were also planned in Australia, South Africa, Japan, Mexico and Venezuela.
The various trials successfully demonstrated that the technology worked, and there was excellent public acceptance. However, widespread deployment of the Mondex product in the 1990s was risky, because the smart card infrastructure was not as ubiquitous back then, as it has now become. The world banking system not yet ready to implement the systemwide use of digital cash cards. Sadly, the various trials were progressively concluded, and Mondex International was absorbed into MasterCard in 2001.
The technology developed through the Mondex schemes via MULTOS, however, did in fact change the world! MULTOS is the historically important outgrowth of the Mondex card. This operating system was developed by Hitachi and NWDT specifically for the Byte2 and Mondex cards, but NWDT did not limit the system to the development to Cash cards. Many other applications were explored during the evolution of the Multos OS (Multi-application Operating System) Codes on the back of Mondex and Multos cards often indicated which version of Multos OS was being used. M1 first OS for Hitachi chip Byte2 simply showed the BULL chip ICON. Other examples of Multos OS are MM2, MM2-2, MM2-4, H3MM4000, H7MA300C. In 1996, the consortium MAOSCO was formed to continue MULTOS "OPEN STANDARD" development involving Smartcard manufacturers, Telcos, and payment companies, including Mastercard international.
It is noted here that 2 major streams of programming development, MULTOS, and JAVACARD, directly led to EMV (Europay, Mastercard, Visa) card standards by the late 1990s, where, by the mid 2000s, all our credit cards now incorporate the Chip advancements made from the early incredible achievements of the Byte/Mondex cards. Mondex cards were the first Chip cards to earn a Level E6 certification by ITSEC (information Technology Security Evaluation Criteria) where both the hardware (Chipcards), and software (MULTOS) were highly resistant to physical and logical (hacking) attacks.
If Mondex was launched 20 years later, we might have an entirely different SVC landscape.
We would like to Thank Bev Stevens and a few others for their help in writing.
As a footnote, Mastercard were running a parallel product called "Mastercard CASH" from as early as 1995, and even small field trials were conducted, including a WESTPAC bank field trial in Canberra, Australia. Mastercard cash purse has been issued as late as 2021 in South Africa for added public transport payment functions on normal credit cards.
