Remember all the stuff I say about the markedly reduced costs of digital bearer transactions? Wanna bet that if a bunch of big bankers say the cost reduction one order of magnitude, given Moore's Law and a little programming elbow grease, we can bring it down to three? Cheers, Bob Hettinga --- begin forwarded text X-Sender: schear@mail.lvdi.net (Unverified) Mime-Version: 1.0 Date: Fri, 2 Jan 1998 23:01:06 -0800 To: rah@shipwright.com From: Steve Schear <schear@lvdi.net> Subject: E-Cash cost advantage acknowledged The vast cost advantages of e-cash transactions was acknowledged in a Banking Industry Technology Secretariat (BITS) paper presented at last year's Electronic Payment Forum meeting in Hilton Head, SC on July 17-18, 1997. http://www.epf.net/PrevMtngs/July97Mtng/Presentations/Schutzer/index.htm BITS, a Division of The Bankers Roundtable, members are the 125 largest U.S. holding companies represent 70% of financial assets and deposits in the United States and employ over 1 million people. Projections provided by Salomon Brothers, Nilson Report, Financial Institutions and Markets, and Boston Consulting Group, show e-cash transaction costs easily outdistance ACH/EFT by a factor of 10. Credit cards will be about 40 times as costly. Even the highly touted ECP (Electronic Check Payment) approaches are likely to be 20 times as expensive. What is most interesting is that despite this acknowledgement almost all the BITS member institutions are pursuing a path away from e-cash and second place EFT embracing higher margin (and higher merchant/consumer cost) alternatives, for example VISACash (cash in name only). In fact, many major banks see EFT/POS (and e-cash) is a threat to their franchises and have moved to keep them from expansion through non-competitive practices and regulatory pressure. --Steve PGP mail preferred, see http://www.pgp.com and http://web.mit.edu/network/pgp.html RSA fingerprint: FE90 1A95 9DEA 8D61 812E CCA9 A44A FBA9 RSA key: http://keys.pgp.com:11371/pks/lookup?op=index&search=0x55C78B0D --------------------------------------------------------------------- Steve Schear | tel: (702) 658-2654 CEO | fax: (702) 658-2673 First ECache Corporation | 7075 West Gowan Road | Suite 2148 | Las Vegas, NV 89129 | Internet: schear@lvdi.net --------------------------------------------------------------------- I know not what course others may take; but as for me, give me ECache or give me debt! "It's your Cacheª" --- end forwarded text ----------------- Robert Hettinga (rah@shipwright.com), Philodox e$, 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire' The e$ Home Page: http://www.shipwright.com/ Ask me about FC98 in Anguilla!: <http://www.fc98.ai/>