The number of smart cards in use in financial services worldwide hit 170 million in the second quarter of 1997 and promises strong future growth, according to a report from Needham, MA-based Meridien Research, Inc.'s electronic delivery practice.
The worldwide market is expected to balloon to a projected 400 million cards in use in financial services by 1999, say Meridien sources.
The report examines how financial institutions are using smart cards for insurance, credit and debit, home banking, telepayments and stored value applications.
In addition, the report analyzes the world's major smart card schemes-including Mondex, Visa Cash, Cartes Bancaires, Proton and Geldkarte-and provides quantitative data on the strengths, weaknesses and anticipated future viability of each scheme.
The most significant finding of the report is the impact that smart cards could have on the U.S. credit card industry. While U.S. banks have not yet issued any meaningful number of smart cards, they may want to step up efforts based on increased profitability of credit card operations resulting from smart card use. Findings indicate that the U.S. credit card industry could increase its profits by almost 30 percent through smart card-enabled elimination of credit and debit card fraud. FB