American Express ditches contactless fob

American Express plans to scrap its contactless "Express Pay" fob device following a lukewarm response by consumers.

U.S. consumers were less than impressed with the contactless AmEx fob gadgets. "It appears consumers may not be wowed by the devices as much as the card companies had hoped," says The Wall Street Journal. "In abandoning the fob, AmEx plans to focus on its traditional cards -- installing computer chips in them that allow customers to hold the card up to an electronic reader instead of swiping it through a device," the paper says.  

"We have actually found that our customers prefer to use the contactless technology through our traditional cards" as opposed to the key fob, Richard Flynn, a senior vice president at AmEx who oversees "cardless" payments, tells the Journal. 

The paper reports that American Express is writing cardholders to alert them of the fob phase-out. According to an AmEx spokeswoman, the fobs will be deactivated on a rolling time frame. The company will be fob-free by July.

Contactless fobs were only available in limited markets, including New York City and Phoenix.

While AmEx looks set to make more of its traditional credit cards "contactless," other card companies have been testing the contactless technology for use in various devices that include mobile phones. Although widespread acceptance of contactless cell phones in the United States is still several years away, other countries have already gotten a glimpse of the contactless future: Korean shoppers can buy a soda with their credit-enabled cell phones and can even spend using a combination contactless credit card/USB device.