Soon, You Might Pay for Everything With a Coin

Let’s be honest, paying with change is a nuisance. Coins are heavy and cumbersome, and it’s nearly impossible to count them quickly. Some people think coins are such vestigial organs of an old payment system that there are campaigns to stop minting pennies and nickels altogether. As more and more people use credit and debit cards instead of cash, it appears as though coins will increasingly become a thing of the past—except for one Coin, which might completely change the future of how we pay for things.

Coin, a San Francisco-based start-up, announced its first product earlier this month—a credit card sized device that purports to simplify your life (and wallet) by acting as a kind of all-in-one card. With Coin, you can store up to eight different cards—from credit to debit to gift to loyalty cards—on a single device, and toggle between them using a circular button. Coin works just like any other card with a magnetic strip, and can be swiped or even inserted into ATMs.

One Coin for All of Your Cards

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To load various cards onto the Coin, users need to have a smartphone (currently the model works for iOS and Android mobile systems) and a Square-like attachment to swipe your cards, provided with a Coin purchase. After users download the Coin app onto their phones, they simply use the attachment to swipe their cards and then take a few pictures of the cards—the Coin stores the information, displaying the last four digits of the card number along with the expiration date and the CVV. The makers of Coin say that this makes Coin less susceptible to forms of credit card theft where people take pictures of a card, because the complete credit card number isn’t shown. You can still use your individual cards even after uploading them into Coin—something that might be useful at a bar, where you’d need to give the bartender a card to keep your tab open.

In the interest of security, Coin also sends out a low-energy Bluetooth signal when the card is a certain distance from your phone. So, if you absentmindedly leave your Coin somewhere, you’ll receive a message alerting you. You can also configure your Coin so that if it loses contact with your phone for a period of time it deactivates. It’s a way to protect against your card being stolen or lost—and though some have worried that it’s a double edged-sword, since the times you find yourself without phone battery might be the most important times to have access to cash, Coin has added a security feature that deals with this issue. If your Coin deactivates for any reason (your phone dies, you lose your phone, etc.), you can unlock the card manually, by tapping a “Morse-code-like” password on a button.

Coin CEO and founder Kanishk Parashar learned some key lessons from his previous start-up attempts, which centered around peer-to-peer payment apps that attempted to create seamless mobile payment experiences. Parashar found that even though the apps were fairly well received, it was too difficult to encourage users to pay in a way so outside of their normal habits.

“When we released these apps, we got decent traction, but a month or two in we weren’t getting any payments coming into the system,” says Parashar. He realized that there just wasn’t enough critical mass to inspire users to change their normal payment habits. “The existing solutions are already pretty good. needs to be able to interact with infrastructure that already exists,” Parashar explains.

So he went back to the drawing board and created Coin, which he thinks can more seamlessly integrate into the way we conduct transactions.

Some tech writers are concerned that by trying to integrate itself into existing infrastructures, Coin doesn’t go far enough. As Will Oremus at Slate writes:

To me, the only real problem with Coin is that it feels like a stopgap technology, like those CD-changer cartridges that were popular for a little while before everyone switched to mp3s. Replacing eight cards with one may lighten your load by an ounce or two, but is that enough to convince people to take the leap of faith involved in adopting a new payment system?

Over at The Verge, however, Ellis Hamburger praises Coin’s potential universal appeal. “It could end up being very useful for everyone from design nerds to moms and dads,” he writes, “because the value it offers is obvious: on the surface, it takes eight pieces of plastic and turns them into one piece of plastic.”

Coin isn’t the first product to combine multiple cards in one place; in 2010, Dynamics Inc. released a product known as Card 2.0, which worked much like Coin, allowing users to input multiple credit and debit cards onto a single device (Card 2.0 had no related app). Its release was met with much excitement from the tech community, and it won both the first prize and the people’s choice award at DEMO, a conference held in Silicon Valley for start-ups. But Card 2.0 didn’t quite catch on, because consumers could only obtain them through financial institutions. When it came time to release Coin, Parashar made sure to cut out the middleman and market to individuals.

“First and foremost, we went directly to the consumer,” says Parashar. “When you try to change something that is core to a consumer, like paying for things, what you have to do is bring a full solution that replaces the way they did things. Basically, Coin is going to be a lifestyle, and I feel like that resonated with consumers.”

For the next few weeks, early-birds can pre-order a Coin for $50, before the price is raised to $100. Parashar estimates that early-buyers will recieve their Coins in summer 2014.

Parashar acknowledges that, as with any new technology, Coin will be subject to scrutiny, but he welcomes feedback as a way to improve the user experience.

“Anytime there is a new technology that comes into play, there’s always some level of scrutiny. A lot of new products come out and there’s always a lot of analysis about it. First and foremost, we need to technically meet challenges,” says Parashar. “The bottom line is that when you build a product that everyone loves, there’s going to be a good result.”