CACPay: The Evolution of Afloat Cashless Operations

BY BETH POLLOCK, NAVY CASH PROGRAM MANAGER & TEAM LEAD AND MATTHEW WINTER, NAVY CASH PROGRAM SUPPORT & LOGISTICS MANAGEMENT SPECIALIST, NAVAL SUPPLY SYSTEMS COMMAND

Almost everyone believes that technology has made life easier and that it has enabled us to perform tasks that we could not do otherwise. A list of the benefits of technology would be very long indeed. While technology has become essential, its evolution is crucial in meeting our changing needs and wants.

Naval ships have a long history of delivering cash services. Prior to 1988, paychecks were distributed and Sailors would queue at disbursing to cash their checks. Cash and coin drove the ships’ economy.

In 1988, Navy partnered with the U.S. Department of the Treasury on the Automated Teller Machines (ATMs)-at-Sea program to put the first ATM on a Navy ship. At that time, deployed ships managed and stored $75 million in cash and coins. In 2001, the Navy adopted the U.S. Treasury’s new hybrid smart card program, Navy Cash®. This new technology works with a stored value card (SVC) chip on the ship and traditional MasterCard® strip ashore. On the ship, electronic cash is collected throughout the ship’s retail outlets and via the cashless ATM. Sailors have a direct link to home bank accounts to manage personal funds. This evolution effectively reduced cash afloat by 80 percent, reduced the labor intensive workload of counting cash and coins, reduced the amount of cash ships needed to carry and added personal flexibility for Sailors. However, there is still room for improvement.

In 2009, Naval Supply Systems Command (NAVSUP) pursued its next cash innovation by working with the Office of Naval Research’s (ONR’s) Small Business Innovation and Research (SBIR) Program to modernize cashless operations afloat.

The goals of the project are straightforward: keep the solution simple, meet Fleet requirements for cashless operations afloat, minimize dedicated equipment, and save money. After a stringent down-select process, a new solution was selected.

Since 2010, the SBIR initiative “Beep and Eat”, a cashless meal payment system, has been used on board Littoral Combat Ship (LCS) class ships for data collection, and managed ashore via the Logistics Support Team. So far, Beep and Eat has processed meal payments for 104,000 meals totaling $440 thousand. Derek Takara, NAVSUP’s project manager stated, “This may not sound like a big number, but it is a critical achievement in proving the technology works afloat, accountable business processes are supported, and this new way of business is accepted by the afloat customer.” This is important because, in the future, one third of the Navy Fleet is expected to consist of these ‘optimized manning’ platforms.

The Zumwalt-class destroyers will use the same technological and business process platform as LCS; however, it includes increased capability to support ship’s store and vending. The current Navy Cash legacy system has certain business process challenges which prevent effective usage on optimally manned platforms. This new effort is deemed Common Access Card Pay (CACPay), a cashless transaction payment system, a viable and cost-effective solution that meets the warfighter’s operational demands across multiple platform sizes and adds the flexibility to use shore support as necessary.

So how does it work? CACPay is capable of operating off-line, similar to PayPal. It allows Sailors to make purchases on board via a web interface by linking to their own commercial bank cards or bank accounts to enable retail purchases afloat. Self-enrollment is a key program component, using the CAC as the interface to the point of sales on the ship and the U.S. Treasury’s Pay.GOV provides the back-end shore support.

This simpler payment system will decrease the afloat equipment footprint, reduce lifecycle support, eliminate Navy Cash® card costs and increase support to new platforms. This means sailors will not have to carry an additional card, will not have to use their personal money to pre-fund a special Navy account, and will have a much more contemporary and familiar system. When CACPay is ready, Navy will retire the legacy Navy Cash® system currently installed on 130 surface ships and increase support to as many as 160 ships at a comparable cost for the current system. This strategy is a win-win for both the Navy and the U.S. Treasury in terms of cost and supporting our warfighter customers.

Through the Department of the Navy’s SBIR Program, small businesses of 500 people or less have the opportunity to address naval needs in more than 30 science and technology areas. SBIR provides the Fleet with innovative advances in technology developed by small firms. SBIR participants benefit both from program awards as well as the further development and commercialization of the resulting products. ONR SBIR topics address naval needs and should ultimately transition to the Fleet through enabling technologies for future naval capabilities or directly to naval acquisition programs. (http://www.onr.navy.mil/en/Science-Technology/ Directorates/Transition/SBIR-STTR.aspx)

September/October 2015