World smart card market
2008-08-05

                                                                         world smart card market

A Smart Card is a plastic card the size of a credit card with an integrated circuit built into it. This integrated circuit may consist only of EEPROM in the case of a memory card, or it may also contain ROM, RAM and even a CPU. Most smart cards resemble a credit card in size and shape, but inside it is completely different. First of all, it has an inside -- a normal credit card is a simple piece of plastic. The inside of a smart card usually contains an embedded microprocessor. The microprocessor is under a gold contact pad on one side of the card. Think of the microprocessor as replacing the usual magnetic stripe on a credit card or debit card. The smart cards contain an operating system just like personal computers. Smart cards can store and process information and are fully interactive. Advanced smart cards also contain a file structure with secret keys and encryption algorithms. Due to the encrypted file system, data can be stored in separated files with full security.

USEAGE The uses of smart cards are as versatile as any mini-computer. At a hospital, for example, The use of smart cards can reduce healthcare paperwork and protect patient records. The smart card can hold encrypted patient information and use a digital signature or a biometric template to reduce ambiguity about the cardholder’s identity. Tests, treatment, billing and prescriptions could be processed more quickly using the card. Major clinical findings could be added to the medical information section within the microchip. The smart cards are most common applicative in credit cards, electronic cash, computer security systems, wireless communication, loyalty systems (like frequent flyer points), banking, satellite TV and so on.

THE WORLD SMART CARD MARKETThe Smart Cards Market is currently in its early growth stages and this is going to continue in the years to come. With increased competition and reduced prices this market will witness greater venture capital and equity interest. Also, the possibility of multi-technology authentication is significantly driving the growth in the Smart Cards Market. With security concerns running high, the market is optimistic about a buoyant growth period and richer returns from the ever-competitive technological benefits the various segments have to offer. EUROPE Smart cards are much more popular in Europe than in the United States. smart cards in the consumer card payments market had reached near full penetration in western European countries such as France and the United Kingdom. In Europe, the health insurance and bank industries use smart cards extensively. Every German citizen has a smart card for health insurance.

Also in England, the smart cards are used to place the tickets. It could be tested on Scotland's busiest rail route with a view to revolutionise tickets. Season ticket holders on the main Edinburgh-Glasgow line would see their documents replaced with credit-card size plastic passes which would enable tickets to be automatically renewed via bank direct debits. smart cards to automatically pay for one-off rail journeys on other routes without having to buy a separate ticket. The cards would work in a similar way to Oyster cards in use on transport in London. Trials would start in three years' time after the necessary equipment has been installed. They would be funded as part of £72 million of improvements pledged by First Scot Rail as part of its seven-year franchise being extended by three years to 2014. Gary Bogan, the head of franchise futures for the Scottish Government's Transport Scotland agency, which is responsible for the franchise, predicted smart cards would encourage more people to take the train. He said: "The fewer impediments there are, the more likely that people are to travel." Mr. Bogan added that smart cards may also be used in the future as an "electronic purse", with which to buy items such as snacks on trains and at stations. UNITED STATES The United States has taken a strong leadership position in adopting new payment and identification applications that use secure contactless smart chip technology, according to Randy Vander hoof, executive director of the Smart Card Alliance. In the United States, this market has struggled to gain a foothold. But, smart cards may now be getting a second chance in the form of contactless technology. The fast-paced American lifestyle continues to put pressure on retailers to serve customers in an ever-more efficient manner. At the same time, card brands such as MasterCard and Visa, are pushing for a bigger slice of the small-tickets payments pie traditionally reserved for cash. The time is finally right for large-scale penetration of smart cards in the payments market. According to the new Packaged Facts report, Smart Cards in the U.S.: Contactless Payment Cards, roughly 27 million contactless payment cards were in circulation in the United States in 2006. If circumstances permit, that number could top 100 million by 2011. What’s more, increased penetration of contactless payments is expected grow transaction volumes and even managed balances for issuers.

INDIA India has witnessed continued boom in the smart card market in the past couple of years. Frost & Sullivan had estimated the total market of Smart Cards in India in 2005-06 at about $44.7 million, which is expected to reach $148.7 million by 2010-11, registering a CAGR of 22.7%. However, looking at the current rapid growth in the Indian smart card market, these estimates appear to be conservative. Smart card applications in conjunction with mobile communications, biometrics, RFID, and e-Payments are fast penetrating in a variety of socio-economic spheres and regions of India. Smart Cards are rapidly proliferating into newer application areas in the country – ID including National ID, Access Control, Driving license and Vehicle Registration, e-Passport, Retail, Loyalty, Banking and Finance, Close User Group Applications, Healthcare, Transit and Fare Collection, Toll Collection, and many other applications. 

LATIN AMERICAThe Latin American smart card market has made huge strides in a relatively short amount of time, with the migration to EMV in banking and GSM in mobile telecommunications, mobile banking initiatives, and government and commercial secure identification initiatives in progress throughout the region,” said Randy Vander hoof, executive director of the Smart Card Alliance. “Having a full day session featuring these important developments will bring added value to our Latin American attendees and those attendees interested in gaining a better understanding of the Latin American market.

CHINA According to Smart Cards Special Committee of China Information Industry Chamber of Commerce, the shipment of China's IC card market was about 1.08 billion pieces in 2005, up 91.8% year-on-year; while the shipment revenue increased 11.1% only to RMB 5.607 billion. In 2006, the shipment was about 1.676 billion pieces, rising 55.2% year-on-year; the shipment revenue ascended 32.4% only to RMB 7.426 billion. This was caused by increasingly intensive competition in China IC market and the dropping prices of SIM card particularly. With the historic statistics from Committee of Smart Cards of China Information Industry Chamber of Commerce, Research In China evaluates and forecasts the IC card shipment and shipment value from 2007 to 2008 by using time series method. During this course the following factors are considered: Gold Card Project of Ministry of Information Industry, issuance of the 2nd generation of ID card, plan of bank card EMV transference, and 2008 Olympic Games. In 2006, IC card shipment volume and value reached 1.676 billion pieces and RMB 7.426 billion. While in 2008, the volume will increase to 4.183 billion pieces, 1.5 times more than 2006; and the value will hit RMB 14.656 billion, almost doubled that in 2006.