switchback.html - A computerized link between financial institutions and points of sale, enabling goods to be paid for by debit card using EFTPOS; in the UK, a computerized EFTPOS system set up in 1988 and used by a number of banks. Etymology: Switch in computing already meant 'a program
instruction that selects one or other of a
number of possible paths
according to the way that it is set'; in the context of EFTPOS, the choice of the name switch was probably also influenced by packet-switching, a standard mode of data transmission in which a message is broken down into parts or packets. History and Usage: The first point-of-sale
computer systems to incorporate switches as the link between
retail outlets and
financial services was set up in the US in the second half of the seventies, when the
State of Iowa established a statewide switch network. The debit card system actually
known as Switch in the UK was launched by the Midland Bank, NatWest, and the Royal Bank of Scotland in 1988. Using this system, shoppers need only a plastic debit card (see card°) called a Switch card to pay for goods; the switch ensures that the appropriate sums are transferred electronically from the purchaser's account to the retailer's. For this reason, the switch was thought of in the early eighties as the herald of a cashless society in which a debit card would be all anyone would need to carry; although the switch systems are reasonably successful, in the early nineties this
result still appears a long
way off. Though similar systems have been
tried on a much smaller scale by Hy Vee and Dahl's, both in Iowa, Publix is the first supermarket company to
own not only the in-store terminals but also the crucial switch that channels the messages from varied sites to the
appropriate banks. Supermarket News 2
July 1984, p.
1 Barclays and Lloyds are pushing
their debit cards hard. So are National Westminster, Midland and Royal Bank of Scotland, which
have jointly developed the Switch debit card system. Their
standard cheque guarantee cards double as Switch cards; there are now 10 million Switch cards in circulation. Independent 27 Jan. 1990, p. 8
