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Woodland Park bank offers new way to pay merchants through cell phones
Nov 06, 2009 (The Gazette - McClatchy-Tribune Information Services via COMTEX) --
"Cash, credit card or cell phone?" That's what nearly three dozen merchants in Woodland Park are asking their customers as part of a trailblazing 3-week-old program designed to reward residents of the Teller County city who shop with local retailers.
Park State Bank is one of a handful of financial institutions nationwide that have issued postage-stamp-sized stickers to account holders to attach to their cell phones. The stamps are used like debit cards.
About 100 of Park State's 6,500 customers have activated the stickers, which can be used at 34 Woodland Park merchants to buy meals, merchandise or services, said Tony Perry, bank president.
"Our goal is not to leverage this into an income source -- we're just hoping to break even -- but to instead get people to shop locally and keep our tax base in Teller County," Perry said. "We didn't want exclusivity on this program; we want every financial institution here to participate. We still have a lot of merchants to talk to, but once we get more merchants on board, consumers will follow."
Information on the sticker contains the customer's bank account information and a radio-frequency-identification chip that is scanned by a wireless reader at the merchant. The chip sends the information over an encrypted cell phone network to the bank to get the transaction approved. Once the transaction is approved, the system sends a text message to the customer's cell phone with the merchant's name, amount of purchase, account balance and rewards earned.
The program, offered through Palo Alto, Calif.-based Bling Nation Ltd., is attractive to consumers because the bank is giving a 3-percent reward on every purchase until at least mid-April that can be redeemed at the same merchants. Park State and Woodland Park merchants like the program because the fees they pay on each transaction are about half of what they pay on debit and card transactions, said Rod Stambaugh, Bling Nation's regional president in Broomfield.
Tracie Bennitt, a customer at Joanie's Bakery and Delicatessen in Woodland Park, said she uses the Bling system because it is "convenient, easy to use and the bank pays me to use it -- that is the best part. I also am a big advocate of getting people to shop local."
Joel Vasek, co-owner of Joanie's, said one or two customers a day are now using the Bling system, but he expects that to increase as more customers learn about it. He agreed to use the system because it was easy to set up and required no upfront cost.
Stambaugh estimates about one-third of Woodland Park's 110 merchants are participating in the program, including Quizno's, Papa John's, Big O Tire, Seven Arrows Gallery, Charitable Treasures, the UPS Store and Studio West.
Bling Nation began offering the program in La Junta in June and now has 75 percent of the Arkansas Valley city's merchants participating and nearly two-thirds of the customers at State Bank, which also operates a branch in Falcon but hasn't decided whether to offer the program there.
To see more of The Gazette, or to subscribe to the newspaper, go to
http://www.gazette.com. Copyright (c) 2009, The Gazette, Colorado Springs, Colo.
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