A contactless smart card is any pocket-sized card with embedded integrated circuits that can process and store data, and communicate with a terminal via radio waves. There are two broad categories of contactless smart cards. Memory cards contain non-volatile memory storage components, and perhaps some specific security logic. Contactless smart cards do not contain an ordinary read-only RFID, but they do contain a re-writeable smart card microchip that can be transcribed via radio waves.
The first contactless smart card was the Octopus card,[citation needed] introduced in Hong Kong in 1997 for the territory's mass transit system.
Contactless smart cards can be used for identification, authentication, and data storage. They also provide a means of effecting business transactions in a flexible, secure, standard way with minimal human intervention.
Smart cards with contactless interfaces are becoming increasingly popular for payment and ticketing applications such as mass transit. Visa and MasterCard have agreed to an easy-to-implement version currently being deployed (2004–2006) in the USA. Globally, contactless fare collection is being employed for efficiencies in public transit. The various standards emerging are local in focus and are not compatible, though the MIFARE Classic card from Philips has a large market share in the US and Europe.
Smart cards are being introduced in personal identification and entitlement schemes at regional, national, and international levels. Citizen cards, drivers' licenses, and patient card schemes are becoming more prevalent. In Malaysia, the compulsory national ID scheme MyKad includes 8 different applications and is rolled out for 18 million users. Contactless smart cards are being integrated into ICAO biometric passports to enhance security for international travel.
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