Consumers like the idea of a multiple application smart card, according to a survey commissioned by the Smart Card Forum, an industry association.
Nearly two-thirds of respondents said they would be interested in a card that consolidates health care, financial, and government information.
"Most research studies focus on one or two applications or the electronic purse," said Catherine A. Allen, Smart Card Forum chairwoman and a vice president at the Citicorp technology office. "This survey looked at what consumers want to do with smart cards."
Consumers are more interested in managing information with a multiple application card than in a simple payment component, she said.
Of the 1,000 consumers surveyed earlier this year by telephone, 550 also filled out an eight-page survey by mail. The survey was conducted by Speer & Associates Inc., Atlanta, and Behavioral Analysis Inc., Tarrytown, N.Y.
Respondents ranged in age from 18 to 64 and were located across the country.
While 61% of respondents said they would be interested in using a multiple-application card, 45% said they would use a single-application stored value card.
Ms. Allen said 45% is viewed as a high interest in stored value, given consumers' lack of experience with the technology.
Arlen Lessin, president of Lessin Technology Group, a New York-based consulting firm, said he welcomed the consumer survey, which "is supported by a substantial amount of previous research."
Mr. Lessin said that the public has always liked smart cards. "The fly in the implementation ointment is the issuers," he said. "In order for this technology to become successful, major issuers must take major positions in issuing the cards to the marketplace."
Marc Altman, senior vice president of marketing at First of America Corp., sees a consistent pattern of consumer interest, "but we haven't figured out how to deliver (the technology) to them yet."
He said barriers to implementation of multiapplication cards include funding and lack of a standard medical platform, among other issues. "We know what we want to do, and we're trying to work through how we do it," he said. "The whole issue of real price has to be addressed - what will consumers pay for this thing and whether we can deliver it and make any money on it."
Mr. Altman said First of America is planning to implement a smart card program for Western Michigan University.
Though the consumers polled responded favorably to the idea of a multiple-application card, with 26% calling it an "excellent idea," 70% are concerned about privacy.
Consumers worried that financial and medical information might be compromised or accessed without proper authorization.
"There is a concern about privacy - that's no new news to anyone," said Ms. Allen. "Consumers are increasingly concerned about who has access to financial and medical information. They want it on a card, but want to be sure that it's protected, with restricted access.
"We have a new public policy committee, which will come up with industry guidelines to address consumer concerns early on," she added.
Mr. Lessin said magnetic stripe technology is still an impediment to smart card issuance. "Some still see it as an answer."
"It took a lot of years to build the infrastructure based around mag stripe. I see the (cards) coexisting (with smart cards) for many years to come," said Stephen Halliday, vice president of technology for Pittsburgh- based Aim USA, a trade association for automatic data collection.
Magnetic stripe cards are in use for stored value applications such as transit, prepaid telephone, and university systems, but chip cards will be best suited to multiple functions, said Mr. Halliday, an electronic engineer who has designed magnetic stripe systems.
"We will see more use of smart cards next year and even more the year after, but I don't expect a quick transition," he said. "Local use of smart cards will increase dramatically, but for Visa and MasterCard to accept them the logistics of changing all the equipment out there is massive. It won't happen overnight."
Another formidable barrier to widespread acceptance is interoperability, where all cards issued, whether government, financial, or health care, can be read by any point of sale terminal or smart card reader, said Mr. Lessin.
Ms. Allen concurred. Regardless of which institution issues cards, "we want to be sure they're all interoperable, so if a payment option exists on each one, McDonald's could" accept each one, she said.
The Smart Card Forum, while not a standards body, acts as a liaison between the different players in the smart card industry - telecommunications firms, transportation agencies, financial institutions, technology companies, and government agencies - to promote interoperability.
More than 40% of respondents in the survey raised questions about operational issues, such as whether stored value would be retrievable if the card were lost or stolen, or if the cards would be generally accepted at enough locations.
Additionally, consumers indicated that they were most comfortable with cards being issued by banks. They found that credit card companies, the government, telecommunications companies, and large retail outfits were also reliable sources.
