Mondex Canada has begun the countdown to the launch of its pilot project in Guelph, Ont. later this year with the naming of an agency to fill the advertising role in this collaborative venture.

Mondex, a partnership of Canadian Imperial Bank of Commerce and the Royal Bank of Canada, has chosen Bozell Palmer Bonner of Toronto to help with the major task of not only launching a new brand but a new category: electronic cash.

Peter Tutlys, manager of advertising and promotions for Royal, says, ‘We were very impressed with the caliber of the final presentations made by the three agencies [Bozell, Harrod & Mirlin and Saatchi & Saatchi].

‘Bozell was selected based on their understanding of this new category, their initial thoughts on how to communicate Mondex’ unique attributes within this new category, as well as their overall grasp of the electronic cash concept.’

While Tutlys is representing Royal Bank in the set up of the communications for Mondex, he works in partnership with his counterpart at CIBC, Heather Levy, consultant – marketing services, advertising and direct response.

Levy and Tutlys are working in dual roles, for their respective banks and for Mondex, along with marketing managers Carolyn Burke from Royal Bank and Debbie Kassirer of CIBC.

Together CIBC and Royal Bank have over 40% of Canada’s banking market and over 3100 branches across the country.

Joe Clark, a veteran public relations and government affairs specialist, has been brought in as public affairs and community relations director for Mondex Canada to assist with the smooth integration of all aspects of the communications and marketing activities.

The heart of the Mondex system is a micro-computer chip embedded in a plastic card which stores the electronic equivalent of cash, in up to five different currencies.

The challenge ahead for Mondex is to educate the public about electronic cash and to differentiate this ‘smart card’ from others coming into the market.

Consumers are now being introduced to disposable stored-value cash cards such as the QuickChange card from Bell Canada and the Visa Cash card in the first phase of the product test by Visa Canada.

Visa Cash, Mondex’ closest competitor, will phase in reloadable cards later this year in the controlled employee-only tests currently underway with disposable cards in Vancouver with Vancouver City Savings Credit Union, and in Toronto with Scotiabank and Toronto Dominion Bank.

A Montreal test with Les caisses Desjardins begins soon.

Ultimately Visa Cash will have three options, a pre-paid disposable card, a card that is reloadable at ATMs, and a feature card which combines a credit card, ATM card and a reloadable cash card all in one.

Levy says Mondex offers benefits the other cards cannot.

‘You can transfer Mondex electronic cash between people in the same function as you would use cash.

‘You can recharge the card from a home phone, pay phone, atm, purchase anything over the phone or at stores, taxis, at small vendors or vending machines that are unattended.’

Special Mondex wallets will allow consumers to transfer money person-to-person and to get a readout of their last 10 transactions while smaller card readers will display how much cash is left on the card.

Like cash, there are no interest or carrying charges with Mondex and because no information or verification has to be given to the merchant, it is an entirely anonymous transaction.

Clark says acceptance by the retail community is key to the launch of Mondex and the response has been very encouraging.

He says for merchants, the benefits of Mondex are many. Sales transactions are very fast, possibly as fast as three seconds, and as the transaction takes place it’s like physical cash in the till.

No PIN numbers, authorization or signatures are required and there’s no need to give change.

The start up costs for retailers to accept Mondex is low.

They only require an inexpensive stand-alone Mondex terminal, or a wallet for small vendors, which don’t need new telephone lines or computer facilities.

At the end of the day they can download their cash from the terminal to a Mondex card and make a deposit over the phone directly into their bank accounts.

Unlike Visa Cash, retailers will not pay a transaction fee.

CIBC and Royal Bank own the Canadian rights Mondex and are offering licenses to other deposit-taking institutions .

Hong Kong Bank of Canada has already signed on and discussions are underway with a number of others.

Mondex was conceived and developed by NatWest Group, one of Britain’s largest banking entities.

Mondex International is run by a board representing all the founding partner banks in countries around the world, and a global rollout of Mondex is scheduled for 1997.

The pilot project in Guelph will be handled in two phases. A controlled test involving CIBC and Royal Bank employees will be followed by a roll out to the community in the latter part of this year.

Mondex Canada and Bozell are now working to develop the communications plan for the project.

Levy says, ‘This entails a lot of research, discussion and strategic planning, and of course the right means to talk to the consumers and merchants.

‘The initial challenge is to gain awareness and an understanding through education of what Mondex can provide to the public.’

One of the key messages to consumers will be that Mondex is the same as cash, but more.

Tutlys says, ‘We want to align Mondex to be synonymous with electronic cash.

He says, ‘As it is a new category, a new product and a new way of transacting, we have a challenge. But, we think with our Mondex proposition, we have a very good story to tell and our initial research shows consumers are looking forward to this.’

The building of the technological foundation for the Guelph launch is in various stages right now.

CIBC and Royal Bank ATMs are being updated and made Mondex compatible .

Bell Canada, another major partner in the Mondex project, is working on the telecommunications and systems infrastructure, and will be converting several hundred public pay phones in the Guelph area to be Mondex compatible.

The Mondex-compatible home phone will be an evolution of Bell’s Vista screen-based telephones.

Levy sees Mondex as having an appeal across all demographics and expects a wide acceptance of the system.

‘When we introduced ATMs and debit cards, we thought older Canadians would be the most difficult to get on board but they were the most interested. They’re not frightened by technology.’