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February 11, 2001
By
John Tobin
Website:
http://www.credit-card-debts.com
>
Smart Cards: What Are Smart Cards or Smart Credit Cards?
Smart Cards are brainy credit cards that have a Smart Card microprocessor, or tiny chip, built into the Smart Card itself. The Smart Card chip unleashes the awesome power of Smart Cards. Smart Cards, or Smart Credit Cards, are an innovative application that involves many levels of secret codes (cryptography). The Smart Card secret codes are essential to the functioning of Smart Card technology. The user must corroborate his or her identity to the Smart Card each time a transaction is made in much the same way that a PIN is used with an ATM.
The Smart Card and the Smart Card reader execute a sequence of encrypted sign/countersign-like exchanges to verify that each is dealing with a legitimate counterpart. Once this has been established, the transaction itself is carried out in encrypted form to prevent anyone, including the Smart Card holder or the merchant whose Smart Card reader is involved, from "eavesdropping" on the exchange and later impersonating either party to defraud the system. This elaborate protocol is conducted in such a way that it is transparent to the user, except for the necessity of entering a PIN to begin the transaction.
Smart Cards first saw general use in France in 1984. Smart Cards are now hot commodities that are expected to replace the simple plastic cards most of us now use. Visa and MasterCard are leading the way in the United States with their Smart Card technologies.
Advantages of Smart Cards
The chips in Smart Cards are capable of many kinds of transactions. For example, you could make purchases from your credit account, debit account or from a stored account value that's reloadable. The enhanced memory and processing capacity of the Smart Card is many times that of traditional magnetic stripe cards and can accommodate several different applications on a single card. A Smart Card can also hold identification information, keep track of your participation in an affinity (loyalty) program or provide access to your office. This means no more shuffling through cards in your wallet to find the right one -- the Smart Card will be the only one you need.
Experts say that internationally accepted Smart Cards will be increasingly available over the next several years. Many parts of the world already use Smart Cards, but their reach is limited. The Smart Card will eventually be available to anyone who wants one, but for now, Smart cards are available only to those participating in special programs. Your financial institution will contact you directly regarding new chip-enhanced services when they're available in your area. (If you're able to participate in one of these programs, you will receive your Smart Card from your bank or credit union, credit card issuer or bank card association.)
So now you know a little bit more about how Smart Cards work. To learn more, click on another article from our archives.
Here's to your credit!
John Tobin
For
more information on smart card - click here!
> About The Author:John Tobin is a successful author and the
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