While these developments would certainly be significant, they principally involve the competitive repositioning of depository institutions with respect to each other. On the other hand, technologies such as stored value cards, smart cards and electronic cash have a much more dynamic potential to transform, and potentially unwind, the historic relationship between customers and banks. But in comparison to the on-line banking and marketing services discussed above, how electronic commerce will develop, be used by consumers, and affect current laws and contractual arrangements are unsettled and, perhaps, unsettling questions. Indeed, the relative role that depository institutions and non-depository entities will play in the development and distribution of these products to consumers is at issue. For those unfamiliar with the possibilities technology will unlock, a brief review of some of the possibilities may be useful.
Consumers generally are familiar with stored value cards.
For example, in many cities consumers must purchase farecards to ride the subway system by transferring cash for the equivalent value encoded on the card. If more value is put on the card than is needed, the rider's options are somewhat limited. On the other hand, the farecard transaction is in many respects similar to cash. It is anonymous. A rider exchanges cash for a farecard issued by a machine in a transaction that creates no record as to the identity of the rider, either at the time of the farecard purchase or its use to ride the system.