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Last Updated: Friday, 11 March, 2005, 17:11 GMT
Are smartcards as smart as we think?
Suica electronic train-fare system
Phones with smartcards are used in Japan to travel
The Oystercard travel system, used on public transport in London and which could soon double up as e-money, came crashing down for a few hours. Is this a warning as society heads towards a cashless society?

Tens of thousands of pre-pay Oyster passengers in the capital had free journeys in the morning rush hour after a software glitch stopped the smartcard readers working.

The fault occurred, a Transport for London spokeswoman said, because the size of a computer file - sent every day with the latest information about which cards had been disabled - had caused the Oyster readers to fail.

But with TfL looking at ways of making small payments a feature of the cards, she denied this was a sign of things to come.

"Not at all. Oyster has some world-firsts, such as daily price capping. And it has 2.3m cards in the system so with any new technology of that size, things will happen like this."

M-commerce

Smartcards are considered to be the future for transactions. They already operate in limited ways, such as school dinners and corporate canteens, with a growing function in accessing council services.

They are small portable cards or devices, usually of roughly the same size and appearance as a credit card, with an embedded microchip. Mobile phones have started to get them installed too, for so-called m-commerce.

There's no computer system in the world which has no possibility of crashing
Colin Petrie
Infineer
The chip gives them greater capacity to store and use information than traditional magnetic stripe cards, meaning they can be used to store personal information, make payments and allow secure access to other systems.

One report last year suggested the amount spent on cards in the UK was about to outstrip cash, and some say it is only a matter of time before notes and coins become redundant.

But is smartcard technology only one glitch away from making cash an eternal commodity?

"There's no computer system in the world which has no possibility of crashing," says Colin Petrie of Infineer, which is a smartcard supplier.

"They are built by men and will fail, but they need to build resilience by having multiple paths. It's like having two water pipes instead of one. The technology is such that you can do an awful lot without the system going down."

'Foolproof'

He says there won't be a cashless society because of transaction charges incurred by retailers on small payments, but Hong Kong is the model because it has a card which can be used for travel and other payments.

But Jim Tomaney, European marketing director at transaction software specialist ACI, believes the end of cash is still nigh, and the technology is robust enough to make it possible.

"I don't believe that there's a single point of failure in these systems right now in the UK. Chip and pin cards have a chip which as well as having the application that verifies it's Mastercard or whatever, it's also capable of storing a pre-paid purse like Oyster."




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