Embedded chips in Octopus and Shenzhen Tong to debut within 1 yr

HONG KONG: A new smart card that can be used in both Hong Kong and Shenzhen to pay transport fees and shop bills is expected available within a year, Hong Kong Monetary Authority Chief Norman Chan said yesterday.

Chan, at the Second Pearl River Forum, said the new card will be injected with two chips that are used in Hong Kong's Octopus Card and Shenzhen's transportation card Shenzhen Tong. Then they will become usable in both cities.

The two cities will also develop a new card reader to read both Octopus and Shenzhen Tong. People can use either card for payment in shops with the card reader. But the plan still needs time to develop and implement, Chan said.

Chan said he expects to promote similar two-city e-money programs in other cities in the Pearl River Delta (PRD), including Macao. Promoting the circulation of e-money is an important infrastructure to achieve integration in the PRD region, he said.

Chan expects the program will benefit Hong Kong. "Introducing the new Octopus that can be used in both cities will help attract more mainland tourists to spend their money in Hong Kong," he said.

Song Haiyan, chair professor and associate director of the School of Hotel and Tourism Management at Polytechnic University of Hong Kong, commented that this is just one step toward integration in the PRD region. "In the future, we may see more methods for the monetary integration between Hong Kong and the mainland," he said.

It is time to explore more deeply how to enhance cooperation among the PRD cities, said Anthony Wu, chairman of Bauhinia Foundation Research Center. Hong Kong should make use of its advantages and connect with other cities in the region, he said. He believes that the competitiveness of the PRD may be comparable to New York and London three decades from now.

Charles Li Kuiwai, associate professor of the Department of Economics and Finance at the City University of Hong Kong, indicated the exchange rate between the yuan and the Hong Kong dollar will be an important issue in the program.

As the first contactless smart card system in the world, Hong Kong's Octopus card system has grown into a common payment method for virtually all public transport in the city. It is also widely used for payment at convenience stores, supermarkets, fast-food restaurants, on-street parking meters, car parks, vending machines, and other service providers.

Over 19 million Octopus cards are in circulation in Hong Kong, which means each Hong Kong resident owns 2.7 Octopus cards on average. Daily transactions are valued at over HK$90 million, according to the statistics of Octopus Holdings Ltd.

(HK Edition 01/27/2010 page1)