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The big question

Ross O. Storey | Feb. 10, 2010
What is the future of smart cards in Asia?


•    The country is in the process of introducing mobile payments, but still needs to complete infrastructural upgrades before the technology can be fully introduced

•    T-Cash, a micro payment card is also being introduced, along with mobile banking capabilities via SMS

•    There is also a smart card available for motorway tolls, similar to Touch n Go in Malaysia


•    The country is in the process of completing infrastructure upgrades and is planning to introduce smart cards for transportation

•    E-wallets and smart ID cards may also be introduced

What are the main drivers for smart card technology? Is it cheaper, more convenient and consumer driven or something being pushed from the corporate end?  

We believe that the main drivers for smart card technologies are anti-fraud, cost efficiency and the capability to support multiple applications on a single device.

This trend is driven mainly by service providers, with governments across the region continuing to introduce smart card technologies for identification to reduce fraud for identification systems. The transport industry, as a service provider, is also driving this trend with the introduction of smart technologies to enable convenient and efficient travel for the people. Other service providers are also introducing the EMV payment standard to reduce payment fraud.

Why are there large revenue opportunities for developers and vendors of smart technologies? Where are the opportunities and which industries are most likely to be affected?   

Developers and vendors of smart technologies can look to the government and health sectors, as well as FSIs for the large revenue opportunities from smart technologies. The accelerated rate of innovation and adoption of smart technologies in these three sectors across the region will continue to drive opportunities for further deployment and development.

There have been trials in various Asian countries, of incorporating smart cards in mobile phones. How strong do you see this trend and what sort of lifespan do you think the approach of having chips in plastic cards will have?  

When the plastic form of smart cards was first invented, users needed to have their cards make direct contact with a machine in order to make payments or process transactions.

However, as smart technologies continue to evolve towards becoming contactless, the technologies no longer need to exist strictly in the shape of a card. In the future, we believe that the card may not be all that necessary, as its form factor could now become anything from a pen to a USB drive or watch.

In addition, studies have shown that if a person were to forget something in their apartment, the only things they will go back for are their keys, wallet or mobile phone. Coupled with the increased mobile penetration across Asia, the mobile phone is most likely to become a smart card that is capable of hosting several different applications for contactless payments, loyalty points systems, and possibly even transport in the future.


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