Big, fat wallets are a thing of the past. Or at least that’s what Coin is hoping.
The device, about the size of a typical credit card, holds up to eight debit, credit, gift, membership, and loyalty cards and allows you to switch between them with the click of a button.
Card information is scanned into Coin through a smartphone by using a Square-like appendage; the device is then connected to the user’s phone and will notify the user if it appears that they’ve left their Coin behind.
Coin will eventually cost $100, but is currently available for preorder at $50. Though not shipping until the summer of 2014, the card-aggregator received $50,000 worth of pre-orders within the first 40 minutes it was available. Aside from crowd funding, the company is receiving additional backing by Y-Combinator and K9 Ventures.
To some the device seems too good to be true, and it may be. Concerns have been raised about security, its ability to function with a dead or forgotten smartphone, and Coin’s relationship with banks and merchants. The Daily Ticker sat down with Coin founder and CEO, Kanishk Parashar to discuss the product and address some of these concerns.
“Coin is working,” says Parashar. “We’re stabilizing it, making it more power-sipping and fixing a few things that most products have and then we’re going to start manufacturing.”
Parashar believes that Coin is the bridge people need before they can transition to a totally digital wallet. “I learned a big lesson from my last company where I built a payment system purely on mobile phones. What I found was it didn’t scale, we couldn’t change people’s habits,” he says. “With Coin we have a system that works now. It works today but it has the technology for tomorrow so it will fit where we’re headed into the future.”
“Coin is safer than a normal piece of plastic,” says Parashar. “If you leave it behind it will lock up. On the mobile app when you try to add cards you’ll only be able to add your own cards and there will be a pin protection on any sensitive data.”
Coin will also employ 256- and 128-bit encryption on the device, phone, and server.
As for the added security of a signature on the back of a credit card, Parashar says Coin is planning to add that as well. “In the future, we’re going to put your identity on the card. Your name is going to be on it, your signature is going to be on it so merchants will know it’s you who has the card.”
On the Smartphone Connection
“We have a concept called a leash,” says Parashar. “What that means is that if your card is near your phone it’s working, but if a leash breaks, which could happen if you leave it behind or someone steals it, it will lock down and keep your financial information secure.”
Critics of the device have worried about what happens if a user’s phone runs out of batteries or is forgotten at home.
“There are a couple of instances where your phone could die or could be in airplane mode,” notes Parashar. “The Coin will lock but there will be a one-button passcode you can use to unlock the Coin. It’s kind of like Morse code,” he explains.
On Coin’s Relationship with Banks and Retailers
“We have talked to credit card companies and banks before and they love this idea,” says Parashar. “We’re going to continue our talks with them.”
As for retailers, Parashar hasn’t encountered any issues yet but say, “It’s too early to tell because we haven’t distributed Coin through the United States yet.”
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