Boston, MA
December 2004

The Gravitational Pull of Multiapplication Smartcards: How Long Can the US Resist?


There have been several high profile attempts to introduce the smartcard to financial services cardholders, none of which have truly leveraged the capabilities of the technology.  But, the smartcard continues to gain processing power, memory capacity, and advocates around the globe.  This report puts the multiapplication smartcard under the microscope, assesses the capabilities of the two major operating systems on the market today; MULTOS and Java Card, and predicts an eventual evolutionary path for bank issued smartcards in the US.

Nick Holland, Director of the Emerging Technologies Advisory Service and co-author of the report sees the emergence of multiapplication smartcards in the US to be the result of two distinct factors:

“First, there is the transition to EMV just about everywhere else in the world.  While there will not be repercussions immediately, there will be a diminishing acceptance of magnetic stripe cards in EMV compliant regions or higher fees for the non-chip based transactions.  Eventually, this has got to become enough of an impediment to cardholders overseas that the US issuers will decide to migrate.  Secondly, contactless smartcards are, if we believe the hype, set to hit our wallets in 2005.  Forward thinking issuers may see the longer term potential of cards capable of post issuance loading, amending and deleting of applications…” 

One of Eight Exhibits included in this report

Hightlights of the report include…

  • The evolution of smartcard operating systems through four generations, detailing the role of stakeholders and the evolving functionality of the smartcard

  • An explanation of the business case for post-issuance capabilities

  • Market analysis of memory and microprocessor cards globally

  • Details of the MULTOS and Java card Operating Systems including a comparison of platforms

  • Developments in the pipeline for smartcards, including the Microsoft/Axalto smartcard

  • Predicted developments leading to the adoption of payments industry smartcards in the US

The report contains 10 exhibits and is 22 pages.

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