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Smart cards are being toted as the secure means of payment for the future. But there are still some security and legal issues to resolve. This article evaluates current security methods for smart cards and briefly reviews existing legislation related to their use.

Examines the many innovative smart card applications covering areas such as telecommunications, transport, banking, healthcare and employee/membership schemes. Looks at how the banks, financial services firms, information companies and card issuers are gradually reconceptualizing their delivery strategy as well as their businesses to meet the growing need for remote delivery, brand equity and differentiation. Says that smart cards could act as payment vehicles, access keys, information managers, marketing tools and customized delivery systems. Explores possibilities of an electronic purse range from a disposable stored value card to a re‐loadable stored value card which could literally replace low‐value cash transactions. Smart cards would then become integral to the banks’ concept of remote delivery systems in the future, because smart cards are not just a product, they are a new delivery system. Focuses on some of the issues that might be of deeper concern to banks. Suggests a collaboration between banks and providers in the mass introduction of smart cards.

Rapid advances in technology have conferred vast benefits upon modern societies. Money can be transferred by wire in an instant. The internet has dispensed with the need to send faxes across telephone wires. The days when it was necessary to carry multiple currencies across the international borders have all but disappeared. The day is fast approaching when societies will be cashless and people will be able to carry so‐called smart cards that contain all of their funds in the form of electronic cash. Smart cards have the technical ability to facilitate transfers of electronic cash from one smart card to another. Electronic cash can be used to shop on the internet and even gamble there. The shares of a company can be bought and sold on multiple stock exchanges through electronic cash transactions. When a London stock exchange is closed, for example, a person in the UK might transmit electronic cash to New York and buy publicly traded shares because the stock exchanges in New York will be open. If a citizen of one country loses faith in the national currency, he might use an electronic cash transaction to convert his assets into the stronger currency of another country in a foreign bank account. The examples of how modern technology will continue to benefit us are numerous.

The continuously increasing need for de‐centralized information systems offering data to the people who need them irrespective of their physical location, as well as the requirement for exchanging information between different but interoperable systems, make the system’s architectural and functional design more complex and in many cases extremely vulnerable in respect to its security attributes. The concept of a “secure portable information file”, that can nowadays be easily implemented through the available smart card technology, can significantly ease information management and ensure maximum data protection in respect to their integrity, confidentiality and availability. This paper presents the use of smart cards in an educational environment as a case‐study example for demonstrating the above mentioned benefits, focussing on the utilization of the smart card’s cryptographic functions for implementing mechanisms capable of providing an extremely secure operational framework in terms of user and application provider authenticity, management of access privileges and data integrity and confidentiality.

For more than a decade, bankers and others outside the financial services community such as hardware manufacturers have sought to solidify the place of smart card technology as a viable retail point‐of‐sale alternative and, more boldly, as an outright replacement for cash in everyday consumption situations around the globe. Despite strong development efforts and numerous fact‐finding market trials, many banks have found smart card technology to be a losing proposition. This article presents a detailed case study of both consumer and merchant adoption of one smart card‐based retail point‐of‐sale system. The system, called “Exact”, was test marketed for a full year in the Canadian market. Various perceptual and demographic data from consumers as well as firm‐level data from retailers are both presented and assessed. The ensuing discussion offers pragmatic suggestions for those in the financial services community as to how the apparent difficulties and shortcomings of smart card technology may be overcome.

Electronic commerce has been recognised as a source of fundamental change to the conduct of business. Exploitation by business of this innovative approach to payments will necessitate wide‐scale adoption of new processes and technologies and may require new thinking on how organizations adopt innovations. Primarily, these innovations will be interactive and inter‐organizational, i.e. a successful cash substitute will require the concurrent participation of many different organizations, as well as consumers. Current theoretical models of adoption may not cater for this type of innovation. This paper compares four diverse pilot implementations of smart‐card payment systems with Rogers’ (1995) attributes of innovations, adoption processes and adoption decision approaches for organizations. In general, Rogers’ models do not reflect the levels of complexity and diversity found in practice. Extensions of the models are proposed.

TOLIMAC is a research project funded by the Telematics for Libraries Programme of the EU and is developing a system to provide controlled access to, and management of, networked information resources and other services in a library environment. The system is based on smart cards and encryption technology integrating management functionalities ‐such as user identification, remote access control, electronic payment‐, and security requirements ‐such as secure information transfer and financial transactions, document integrity. The system also enables libraries to adjust user access rights, and charges for available electronic resources, whether local or remote, according to user categories. The system is based on standards. It has a Web interface. The pilot system will provide users from three university libraries with access to an electronic document delivery service based at INIST (France), including search, order and delivery of journal articles, as well as payment facilities by means of the electronic purse on the user's smart card.

Explains that the smart card is increasingly being held and used by consumers in the UK, particularly in its electronic purse or loyalty card capacity. The smart card is a plastic card that carries an embedded computer chip with memory and interactive capabilities. Describes the current major payment options open to consumers, and accepted by retailers, with a review of the costs and benefits of each payment option. Considers the electronic purse pilot of Mondex as a new payment option and looks at the issues facing retailers with the introduction of smart cards. Concludes that acceptance of the smart card as a new payment option depends heavily on retailers’ attitudes and these will be formed by the so‐far unquantified balance of costs and benefits that will accompany the introduction of the smart card.

Discusses “smart cards” as electronic cash carriers. Examines technological innovations such as the Mondex “electronic purse” in the UK, where card values can be topped up by telephone. Forecasts that in the next few years, physical cash will be replaced as a main medium for transactions by “e‐cash,” which is cheaper to manufacture, more portable, and more versatile.

Crimes are committed for personal reasons or for profit. In any crime for a profit scenario the state has an interest in removing the profit from the criminal. Drug offences, other than simple possession, are the paradigm. People use drugs for a variety of reasons but, at least in the illicit drug trade, individuals sell drugs in order to make money. Traditionally, this was a cash‐based enterprise and, frequently, a misplaced investigative opportunity. A state can attack the criminal profit in order to attack the enterprise. When an illicit criminal activity is undertaken for cash prosecutors and investigators must look at this as an opportunity.