The smart card are often called chip card, or integrated circuit (IC) card. The integrated circuit incorporates in the credit card size plastic substrate contains elements used for data transmission, storage and processing .

Smart card can act as proof of authorization and as encryption modules other than using it as secure data storage and data processing. There are two types of smart cards:

Contact smart cards require insertion into a smart card reader.

Contactless smart cards require only close proximity to an antenna.

The contact smart card has a small chip about 1/2" in diameter on the front, instead of a magnetic stripe on the back like a "credit card". When the card is inserted into a smart card reader, it makes contact with electrical connectors that can read information from the chip and write information onto the chip.

A contactless smart card looks just like a plastic "credit card" with a computer chip and an antenna coil inside, which allows it to communicate with an external antenna. Contactless smart cards are used when transactions must be processed quickly, as in mass-transit toll collection.

The CombiCard is a single card which functions both as a contact and contactless card.

Some advantages of the smart card:

Proven to be more reliable than the magnetic stripe card.

Can store up to 100 or more times the information than the magnetic stripe card.

Reduces tampering and counterfeiting through high security mechanisms.

Can be disposable or reusable.

Performs multiple functions.

Has wide range of applications (e.g., banking, transportation, healthcare...).

Compatible with portable electronics (e.g., PCs, telephones...).

Evolves rapidly applying semi-conductor technology.

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