Buskers left in the cold by cashless society

The camera crews and scrum of people with mobile phones pressed to their ears suggested that an aspiring Tory leader was in town. But the occasion was merely the buying of a 28p copy of the Swindon Evening Advertiser from Don Stanley, 72, a news vendor in the town's high street.

The event attracted world media attention because it was the first official purchase in a 12-month public trial of a "smart-card" that replaces banknotes and coins.

The newspaper headline ran: "Mondex Fever Grips Swindon", though it might be more accurate to call it a slight temperature. So far just 500 people in the town of 190,000 have the cards, which store cash in the form of electronic numbers on a microchip.

Provided by Mondex, a joint venture between the National Westminster and Midland banks and British Telecom, the cards can store any amount of cash. The cardholder must have a bank account, from which cash can be transferred to the card's microchip.

To buy an item at one of the 700 retail outlets which accept it, the card is put into a reader and some of the numbers transferred to the retailer - just like exchanging a banknote. By the end of the trial next year, Mondex hopes that up to 40,000 people will be using the cards.

But the consortium admitted yesterday that it has so far failed to attract one of the high street's biggest names, Marks & Spencer, to join the pilot. "They have been occupied with installing Switch [a debit card system] and at board level they seem to have an aversion to plastic," said a Mondex spokesman. Business in the town's store, 100 yards from the throng of journalists reporting on the launch for the British, American and Japanese media, seemed unaffected.

However, stores such as Boots, Debenhams, Dixons, HMV, Safeway, Sainsbury's and Tesco will be accepting the cards.

Some others in Swindon were less keen on the idea of cash on a card. Keith, 27, was doing a fair business busking on the high street. "It's a good idea," he said. "But I haven't got a bank account." Nor did he have any way to accept donations in electronic form.

The banks' incentive for pushing the Mondex system is that they currently spend pounds 2bn counting, storing and handling cash. By moving it to an electronic form which can be sent as encoded numbers over a phone line, a lot of the cost and risk of moving money around would be eliminated.

Mondex also plans to introduce a version for the Internet, probably at the beginning of 1997.