It's become routine for customers to swipe their credit or debit cards at consoles in fast-food joints, gas stations and grocery stores. So why do we still hand over the plastic at sit-down restaurants?
Pay-at-the-table systems are popular in Europe and other parts of the world, but they haven't yet caught on in the U.S., largely because equipment makers have been unable to point to a reason restaurateurs should invest in the gear.
Manufacturers now see an opportunity. A rise in the number of "skimming" scams in which waiters use hand-held computers to steal customers' credit card information and sell it is creating a sense of urgency. So is a push by managers to speed the flow of diners during peak hours.
"Restaurants are the last holdout where you still give up your credit card. That's why we think this is the next logical step," said Paul Rasori, VeriFone Inc.'s vice president of marketing.
Verifone's system is about the size of a thick remote control and sports a square liquid-crystal-display screen and a numerical keypad. It accepts debit and credit cards and can automatically add a tip.
Once the customer swipes a card, the information is sent wirelessly to a computer in the restaurant. A tiny printer spits out a receipt.
The Blade, a competing system from rival Hypercom Corp., is a sleek hand-held unit. But it also sports a touch screen that can double as a menu and an optional reader that allows customers to wave their cards instead of swiping them.
Both companies are betting that restaurants will be more willing to buy the systems, which can cost several hundred dollars, as security threats increase.
Some studies suggest that as much as 70% of all cases of credit card skimming stem from restaurant scams. A 2005 report by Fair Isaac Corp. detailed how hand-held skimming devices could take seconds to transmit data wirelessly to a person intent on committing fraud and advised merchants to use table-side devices so cards are always in a customer's hand.
The pay-at-the-table manufacturers say there's another benefit: greater productivity.
"If we can tell them they can increase table turns on peak hours by 1% to 4%, what's that worth to businesses?" said Scott Goldthwaite, vice president of Hypercom's global business development.
But the potential market for the systems in North America -- estimated to be as large as $438 million -- has been slow to take off.
