Smart card is a plastic card embedded with at least one computer chip. Such chips store information and can perform mathematical calculations. Smart cards are used with many electronic devices, including automated teller machines (ATM’s) and cellular telephones.
People sometimes use the term “smart card” to mean any card that stores information, including one that uses a magnetic stripe or simple memory chip. However, the International Organization for Standardization (ISO), an association that sets standards of quality to help world trade, regards only cards with both microprocessor chips and memory chips as smart cards. Microprocessor chips perform calculations. Smart cards do not have batteries. They get their power from the device used to read the card.
Smart cards can store much more information than magnetic-stripe cards can. A common magnetic-stripe identification card might hold a person’s name, address, Social Security number, and insurance information. A smart identification card could also store a person’s fingerprints and keep track of drug prescriptions.
Some smart cards store a money value that can be used for purchases. Such cards can then have value returned to them by electronic transfers from a bank account. Some smart cards are used as security devices. With a code or password, they can enable a person to use an ATM or other electronic device.
