The Smart Card Forum's latest consumer research revealed a bright outlook for the advanced plastic card technology-but not in the way financial industry executives might be hoping or expecting.

In an extensive North American survey, completed for the forum late last month by the New York research firm Find/SVP, popular opinion leaned more toward health care services than banking and payments.

The findings caught people attending the Smart Card Forum's annual meeting in San Francisco by surprise. According to a show of hands, few thought that consumers who expressed an interest in smart cards would be more receptive to a Med-Alert or health insurance service than bank access, a debit card, or credit card.

"We are seeing a difference between 'us' and 'them,'" said Alan Kornheiser, the Find/SVP project director. "What people who don't know much about the technology want may not be what we think they want."

The findings-which Find/SVP has only had time to summarize as it prepares to deliver a more detailed report in November-are highly favorable at what researchers call the "top line." But Smart Card Forum president William J. Barr said much new was learned, indicating that the industry has yet to fully understand the market and its potential.

Among the good news, Mr. Barr said, was that a majority of North American consumers are at least somewhat interested in the enhanced cards with computer chips. And many of them grasped the cards' multiple-function capabilities, which bankers and others view as crucial to the technology's economic justification.

"Consumers get this," Mr. Barr, executive director of information networking at Bellcore in Morristown, N.J., said at a press conference during the San Francisco meeting. "It's not a difficult proposition for them."

In focus-group sessions conducted in six U.S. and Canadian cities, where "technophobes" were weeded out and interviewers took time to explain the chip card concept, virtually all participants embraced the possibilities and even proposed their own service and security ideas.

For example, Mr. Kornheiser said the cautionary notion of "Big Brother" arose in every discussion, and the consumers suggested they would feel secure about personal privacy if the sale and support of cards were distributed, rather than placed under a single authority.

Using such focus-group input, the forum and Find/SVP designed a questionnaire that was administered in telephone interviews from Aug. 13 to Aug. 26 to 2,400 randomly chosen English-speaking people over age 18 in the United States and Canada. To be included, a respondent had to have at least one plastic card or transaction account.

Of the 2,400, 76% were somewhat, very, or extremely interested in the smart card as it was defined to them: a card with computerized memory that can hold almost any kind of information but requires a reader for input or output of data.

Subtracting the 45% who were merely somewhat interested, 31% constituted a sizable "early adopter constituency," Mr. Barr said, and "a good group to start with."

Compared with those not interested, the interested group was far more likely to have personal computers, mobile phones, and other high-tech devices (98% to 68%), to be younger (average age 38 versus 48), and have higher annual incomes ($54,000 versus $45,000). There were no significant differences according to sex, race, or location, Mr. Kornheiser said.

Of those interested in smart cards, 35% wanted a single card to replace most of what they currently carry in their wallets. Another 30% preferred two cards, 27% three cards, and only 6% four or more cards.When the group was asked what they would "definitely want" on a smart card, seven services got at least a 50% response. Three were health-related, two auto-related, and two banking- or payment-related.

Medical-alert information topped the list at 74%, followed by 62% for health-insurance identification, 59% for automated teller machine and related bank access, 56% drivers license, 53% credit card, 51% prescription card, and 50% car information.

Money for small purchases-the electronic purse idea that is helping to drive early chip card growth in Europe and elsewhere-came in at 48%. Money for larger purchases was down, at 36%.

Discount shopping, frequent flier, and "other ID" were under 40%; "other membership cards" brought up the rear, at 26%.

The receptivity to health-related cards flies in the face of consumer and privacy advocates' critiques of government proposals for health care cards or identification codes similar to Social Security numbers.

Mr. Barr, who said "I consider myself a privacy advocate," said security is inherent in chip card design. Though consumers might resist something imposed on them, especially by government, they will favor something voluntary, especially if it is something they can design. The Find/SVP research showed consumers like the idea of a "starter card" to which they can add services at their discretion, and might even pay as much as $50 to obtain a card and $25 annually to maintain it. "Smart cards are supposed to perform lots of diverse functions, and we're pleased those surveyed could identify so many of them," Mr. Barr said.

He said the "useful new information" uncovered is "just the beginning of our industry's efforts to learn about how we can connect with and educate consumers whose interest in smart card technology increases in relation to the information they have about it."

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