Proton to set up US$300m R&D center in Malaysia

Posted on May 21, 1999 
Filed Under CNET, Julian

KUALA LUMPUR–Leading smartcard technology provider Proton World International SA will invest US$300 million over the next 10 years in a regional research, development and support center in Malaysia.

“We will work on key smartcard technology applications, specifically integrating contact and contactless technologies onto a single card which can operate in both modes,” said Danny Vanhoutte, general manager of Triumphant Launch Sdn Bhd, the local representative company of Proton World.

He said the convergence of a contact card for e-purse transactions and a contactless card for transport applications is seen by many card issuers and industry analysts as the “killer application” that will lead to widespread use of smartcards.

“Cardholders who use the card in contactless mode daily for travelling to and from work will also use it in contact mode to buy newspapers and snacks and to pay for phone calls, road tolls, parking and vending machine purchases,” he said.

The company plans to recruit 48 staff in Malaysia by 2005, who will likely be trained in Belgium.

“Malaysia is pro-active in adopting smartcard technology and is at the forefront of developing new applications for such cards,” he said.

Proton World is a partnership between American Express, Australian smartcard player ERG, Visa International, Interpay Nederland and Belgian banking consortium Banksys SA. It has one of the largest base of e-purse card users in the world with 30 million cards in circulation, distributed by over 250 banks and accepted by 230,000 terminals in 15 countries.

Vanhoutte said the center’s other role will be to provide technical support and sales and marketing services for customers in the Asia Pacific region.

“Malaysia is the ideal location for our purposes. Geographically it is centrally located and is multi-lingual, so we can train staff who speak English, Chinese, Indian or Malay languages and send them out to the region.

“The government is also pushing IT and has a long-term goal to become a multimedia and e-commerce hub,” said Vanhoutte, who is also regional sales director.

He was referring to Malaysia’s Multimedia Super Corridor (MSC), a 750 sq km high tech zone, south of Kuala Lumpur, being developed as a Silicon Valley of the East.

One of the key applications of the MSC is a multi-purpose smartcard which Malaysia plans to issue to each of its citizens.

Under the roll-out plan, there will initially be two cards, a payment card for debit, credit, e-cash and automated teller machine (ATM) transactions, and a government card for identity, driving license, medical and immigration purposes. The government plans to migrate all the applications onto one supercard eventually.

Triumphant Launch and its partners were chosen to incorporate Proton technology for the e-cash component of the cards for small value transactions, and is currently bidding to develop other financial applications on the payment card.

Vanhoutte said Triumphant Launch recently received “MSC status” by the government which guarantees companies located within the zone access to high bandwidth, 10-year tax holidays, unlimited import of foreign knowledge workers and other incentives.

Published in CNET Asia, May 21, 1999
by Julian Matthews, Malaysian correspondent

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