Smart cards are here to stay the benefits and security far outweigh any fears of Big Brother getting his hands on information about you, Dave Parratt, director of customer electronic delivery, at Standard Bank, says.
A smart card is basically a mini-computer, which looks much like your ATM card. But instead of a magnetic strip, it has a small chip embedded in the plastic.
The chip technology, Parratt explains, is what gives a smart card the security edge over magnetic strip cards.
"Each chip is unique and this makes smart cards very difficult to copy."
On the other hand, he says, from a fraud perspective, magnetic strip cards are easier to reproduce and this practice is becoming more and more prevalent.
Parratt says you will see more and more smart cards on the market from next year, as international standards are being adopted and technology implemented.
He says this process is driven by research into international practices, by co-operation between South African banks and through a committee set up by the banks and government to focus on the implementation of this chip technology.
WHAT'S SO SMART ABOUT SMART CARDS?
An article in Consumer Focus, a publication of the Consumer Institute of South Africa, points out that although the original idea behind smart cards is that of a cashless society, things have become so "smart" that these cards are no longer just used as payment vehicles, but also as information managers in the areas of healthcare (storing your medical scheme data), government (storing your driving and identity details) and in business, for the purposes of customer information and reward programmes.
So clearly smart cards are versatile, because they can be programmed and re-programmed for multiple applications.
In fact, Consumer Focus points out, the only limit on the development of the card's applications, is the human imagination.
At the moment, the benefit of protected personal and sensitive information outweighs the concerns about your right to privacy and security of information.
Though these cards are small and can be carried around as you would an ATM card, they contain information which can only be accessed through a computer.
An additional security feature is that the data can only be accessed with a PIN number. Some carry additional identifying features, such as digital fingerprints, retinal eye scans and voice signatures.
So, Parratt says, instead of worrying about the risk that someone will find out all there is to know about you, including your bank balance and account number, you should welcome the smart card and its built-in security mechanisms.
The institute, however, suggests that the secure nature of smart cards does not mean your protection should not be ensured through government regulation and through mechanisms for redress.
HOW A SMART CARD WORKS:
There are two different kinds of smart cards: those that have a micro-processor and memory chip, enabling them to add, delete or manipulate information stored on them; and disposable ones, that have only a memory chip, which can undertake pre-defined operations (just as a phone card does). An important difference between a card with a magnetic strip and a smart card is that a smart card contains all information and functions on it, and does not require access to remote databases, when you want to perform a transaction.
Apart from the security benefits, advantages of smart cards also include the fact that they can store a lot of information; they are stronger and more reliable than magnetic strip cards; they can perform multiple functions; and they are compatible with ATM machines, as well as phones and personal computers.