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Smart Cards. When the Future Reaches Us

Smart cards, the main contestants for the title of money in the future, are plastic cards similar in size to the normal credit cards, but with an integrated circuit inside. They are called smart cards because, in addition to a greater capacity for storage than the traditional magnetic tape in the ordinary cards, these can also process information. There are basically two types of smart cards: those that are discarded and those that can be re-charged.

The use of smart cards is popular mainly in Europe and Asia, not so in the United States. The cards can be used in communications, medical registers, and as debit and credit cards. The field of communications seems to be the principal use for these cards, since it is estimated that in 1996 some 420 million telephone cards were sold. Nevertheless, the market that will most be affected by the coming of smart cards will undoubtedly be the money market. Actually more than 90 banking institutions in the world have systems that use them already.

The so called ATM's (auto-cashiers) exist already. These are machines, the size of a calculator, with which, by telephone, one can access the bank computers and transfer money from your account to the card, from wherever you are. And, of course, one of the principal applications in the near future will be electronic commerce through Internet.

One thing is certain. The moment when all the relevant information about persons will be stored in a card is getting close very fast, and that will be enable you to carry out most of the necessary commercial transactions.

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July, 1997