Branching Out

Public assistance programs represent the first widespread use of smart cards in the United States, but such projects won't be the last.

Pilot programs are springing up everywhere. Currently, a smart card project launched in Manhattan's Upper West Side brings the idea of electronic cash to New York consumers and merchants. MasterCard, Chase Manhattan Bank, VISA and Citibank run the project using Mondex -- the world's leading electronic cash system. With almost 700 merchants participating in the pilot program -- including several well-known New York retailers like Fairway, Sloan's and The Athlete's Foot -- the program is providing consumers with a more convenient way to make small transactions.

Smart card technology and infrastructure in some countries have improved enough to handle most of society's small, everyday transactions. Australia, for example, is thinking about using smart cards as a replacement for all currency, and it already has a large smart card infrastructure, which makes it an ideal country for testing a fully electronic system of currency.

Australia doesn't intend to replace debit and credit cards, which account for 85 percent of its retail transactions. Rather, smart cards will replace everyday currency, which the country uses for 90 percent of its small purchases -- such as bus fares, groceries and movie tickets.

Amazingly, smart cards could replace currency in America as well. The EBT mandates show a national understanding that government needs to take the initiative when it comes to technology advancements, rather than just riding the commercial infrastructure. With their statewide smart card programs, Ohio and Wyoming have taken the initiative -- one that will spur America on into the great electronic frontier.

Bill Curtis is the editor of "California Computer News."

February Table of Contents