Smart cards, sometimes called integrated circuit (IC) cards, are similar to magnetic stripe cards, but with an embedded microcomputer chip rather than a stripe. The term smart card is a generic one; smart cards range from simple chip memory cards to sophisticated microprocessor cards. All cards use an ISO standard to store information on an integrated microprocessor chip located within the plastic card. Smart cards require readers like the magnetic stripe cards, but with specialized contacts.
Agencies looking to establish a multi-purpose program have shifted their focus to smart cards for this reason. Multi-purpose programs are those programs that either use media that can have multiple applications or can be used for more than one agency (integrated fare). An example of multi-application media would be a smart card that could be used for paying fares, banking services, health care records, vending, etc. An example of an integrated fare media would be a smart card that could be used for more than one agency (e.g. different modes – buses, trains, ferries, or between different transit agencies).
Another advantage of smart cards in transit is the ability to perform security checks to guarantee the veracity and incorruptibility of information stored in the card’s memory. Furthermore, the security against tampering with the card’s data is much greater.
Proximity cards are a type of smart card, and have further advantages in transit over contact type smart cards and magnetic stripe cards. First of all, they have the potential to rapidly speed customer boarding times. They provide greater convenience for riders, especially for riders who are elderly or with disabilities that make it difficult for them to insert or swipe a card. The use of proximity cards also has the potential for lower fare collection equipment maintenance costs, because there are no moving parts in the read-write units. Finally there is a greater reliability of equipment, because there are no open slots that can be jammed.
Although proximity cards are preferred by most transit agencies, contact type smart cards have been implemented in several transit applications and are planned for others. The reasoning behind this is that there are several smart card applications that have been initiated by financial and other institutions other than the transit agency. Other institutions prefer contact card technology because it has existed longer and considerable time and resources have been spent in the development of specifications and applications. Furthermore, contact cards are the choice for most non-transit applications, as there is no benefit of the increased speed of proximity card technology, which generally is more costly.
Another option that attempts to bridge the gap between contact and proximity cards are combined cards that contain separate chips for both contact and proximity interfaces. These cards are also known as “hybrid”, “combi”, or “dual interface”, and are of three basic types. A hybrid card has two completely separate chips; value cannot be transferred from the contact purse to the proximity purse. A combi or dual interface card has a single chip with both contact and proximity interfaces. These cards may have separate purses like the hybrid card or one single purse that can be directly accessed by either interface. The combi-card is obviously a more complicated device and therefore is more expensive than a contact or proximity card alone (from 1.5 to 2 times the cost).