By Nicki Tesch

Who would have believed 50 years ago, that in 1997 a small card would be used to store retrievable personal information? Realistically, not many individuals would have believed this "nonsense". Today, that "nonsense" has become a reality. Credit card sized plastic cards with integrated circuits embedded in them hold information in an electronic form. The card itself controls this information. One major difference stands out, when comparing smart cards to regular credit cards. Smart cards were thought of with the hope and intent of replacing the consumer's wallet. An interesting note, smart cards can actually incorporate 10-100 times the storage capacity of a credit card's magnetic strip.

If one want to distinguish smart cards from one's regular cards, one needs only to check for a golden plate, which is embedded in the plastic. This plate is most often divided into 8 parts: microcircuit, memory access, input/output areas, reset circuits, CPU, clocks, and a magnetic strip (in some cases). A microcircuit employs these contacts to communicate with external devices. These microcircuits are composed of memory access, input-output areas, reset circuits, CPUs, and clocks. The magnetic strip provides data storage, which is read-only. Most smart cards are based on a function of embedded electronic information. The smart card can store and secure data, and has read/write capabilities.

There are two types of cards: contact and contactless. Contact cards make contact with the reader and it (the card) receives an electrical voltage which powers the IC chip that is embedded in the card. The speed of processing varies and the contact plate provides an input/output path for data transmission. The contactless card communicates using radio signals. One only needs to place the card close to the reader (proximity range from very close to several feet in distance).

Smart card technology was invented in France. France and Germany lead the way for its development. Currently, they have highly developed systems. Smart card technology is beginning to become known in Hong Kong, New Zealand, the United States, Australia, and the United Kingdom. Smart card technology is useful in many industries such as: telecommunications, healthcare, government, banking, education, and travel.

Costs related to smart card production and operation include (1) the production and delivery of the cards (2) the cost of peripherals needed to interact with the cards (readers connected to telephones, standalone readers, reader connected to computer) (3) transaction costs (varying status, authenticity, and balances). Smart cards are very comparable in price when compared with other technologies of such a nature. The costs vary with the amount of capacity required, and the quantity and level of security needed. The average card ranges from $1 to $20 in US currency. A typical $10 to $15 card is equipped with 2K to 8K rewritable memory, an 8-bit microprocessor, and a built in encryption algorithm. The cost of a reader for such devices begins at $100 and steadily increases.

Smart cards focus on a large variety of individuals and industries. These cards are a benefit to healthcare providers, telecommunications, educational practices, travel, and the retail industry. The benefits even reach government organizations and financial services.

In the healthcare department, smart cards store personal medical histories. Smart Card technology enables the privacy and protection of patient records in the medical workplace as well as enabling the processing of patient information even if normal communications are nonfunctioning. This will provide crucial information, such as the tracking of medication and medical information, during emergencies. This information assures patient identity and makes possible the immediate verification of patient insurance coverage. The smart card can store full size medical records including x-rays and other graphics.

Smart Cards can store information regarding pre-paid calling plans and other services in the telecommunication industry. An example in the education industry would be the St. Thomas Student ID card. This card has the ability to be used for meal plans, credit/debit cards for on campus goods, check-out library books, access to buildings, and can be use in vending/laundry/copy machines.

In the travel industry, the smart card can be used to book flights, select seating, check-in, check bags, and can replace a drivers licenses or passport. Also in mass transit, smart cards can replace the token. In the retail industry, retailers can store consumer trends and consumer information. The smart card can be used as a loyalty card. When the consumer makes a purchase, points are awarded to the card and can be dispensed immediately. This eliminates the paperwork of most incentive programs.

The financial industry is more obvious. Currently, credit and debit cards are in circulation. Also, cash cards are another example in the financial industry. As far as the government organizations are concerned, information would be more accessible for them and less redundant in their files.

There are several benefits of smart cards. There is great-enhanced security as well as confidentiality, cost effectiveness in regard to reducing human error and transaction processing. These cards are multi-functional and their storage capacity is 10 times more than that of magnetic strips. These cards amount to less paperwork by utilizing electronic processing, and there is less need to carry large amount of cash, which means more convenience and security.

There are fewer incidents of crime in comparison to the ATM card, which has non-existing security features. In regard to security, smart cards make use of personal identification numbers (chosen individually), biometrics (which incorporates unique personal characteristics of each user (fingerprints, voice, signature), and encryption (which makes it impossible to forge or counterfeit because of the microprocessor's ability to generate unique encoding).

This technology also assures cost savings by eliminating telecommunication (i.e. phone lines) costs and duplication of information. Smart Cards will also leave audit trails, which will help, in fighting fraud and other illegal activities. It also creates a simple way to obtain information on consumers and their purchases. In turn, analyze consumer trends.

There seem to be few limitations regarding smart cards. This is a new technology and so upgrading is inevitable. As well, there is a great chance of consistent loss of their smart cards, which would require replacement. Currently, there is no universal card and not all cards work in all readers. There is also the cost of implementing new systems in all areas of business utilizing these information cards. And finally, the possibility of hackers ability to manipulate data in the memory of the card (which is impossible because of the encryption, but is a concern of user.)

This smart card technology seems to be on the rise and very popular. Since this technology has many possibilities, all industries should prepare themselves for this upcoming technology. Since smart card technology is only at the tip of the iceberg, it will continue to be developed well into the future.