Smart card payment system: More security and convenient payment system

We live in a smart world where technological advancements make life easy. Making payments and online shopping on varied platforms has always been challenging in the 21st century. A smart card payment system is like fuel that drives this suitable means of making payments and making online transactions. These cards offer a safe and quick means of financial transactions.

Contact less smart cards have become very common in all economies worldwide, and they are for almost everyone receiving a paycheck. Smart card reduces the archaic manner where people have to carry cash and feel insecure because of the prying eyes and various case of heists associated with moving big chunks of cash.

Smart card payment system provides a safe means for conducting financial transactions and is making life easy in the world, which is going cashless.

Know about smart card technology.

Smart card technology mainly involves making small rectangular cards bright. They are so small that they can easily fit into your wallet, and this is where the first convenience that the card provides is felt. Several institutions starting from banks to business enterprises and other institutions, utilize these smart cards for various purposes. The cards are available in various sizes, but they all have one common thing: the technology driving them. This smart card payment system allows users to store specific data exclusive to them, which they can use for making payments and other such financial transactions without physical cash.

Why are they called Smart cards, and how are they built?

They are called smart cards as they carry a lot of private information and data specific to any particular user, and that is the card’s owner. These smart cards possess memory chips and microprocessors to store user information. The users can use the technology for financial transactions like shopping without using cash, making invoice online payment, transferring funds, and many more things. The cards with microprocessors are smart as they can house so much information and use for occasional demands.

A smart card is built through four basic steps:


The first step involves the designer or the programmer assigning a memory size to the chip, stating the clock’s speed, the type of volatile memory, and the operating system. Here the programmer also makes an application software for the smartcard while giving specifications about the type of the card and different features he wants to include. In this way the designing of the smart card is done in an interesting way.

Fabricating the chip:

In the second step, the silicon chip is fixed in the card. This chip is connected with connectors through connecting wires either by bounding them or by soldering them. Then the chip is sealed using epoxy resin and is glued directly to the card substrate.


This is a crucial step where the groundwork for the card functionality is laid down. Here the codes are entered into the chip’s memory using specific commands.

Loading of data:

This is a stage where the personal data of the intended user is loaded into the memory chip.

Now let’s know how a smart card works and different types of smart cards

  • Smart cards are the same as regular cards you find around you, but they contain a memory chip inside the contact pad. This contact pad is the basis because of which transaction is made using a smart card. The card will remain no longer smart when this contact pad is removed.
  • Smart cards do not function alone, requiring a smart card reader. When specific useful personal information is written in the smart card by the issuers, you will require a smart card reader where you have to put in the card, punch in the personal security code, and do the transaction. The contact pad connects with the card reader and then starts an electronic communication between the card reader and itself.
  • This then allows you to make payments through the Point of Sale system or any other medium for carrying out certain transactions. But some smart cards do not need a card reader interface for function.

Types of smart cards as per the mechanism of work

Contact smart card:

This is one of the most commonly used smart cards. Many credit cards, atm cards, and Sim cards come under this category. This category of card works by putting it inside the card reader which reads whatever is written on the chip and allows the user to carry out the transaction. They are known as smart cards, as they can access the medium even before they start functioning. Here medium implies any digital interface, such as the smart card reader, which facilitates information transmission from the card to the reader.

Contactless payment card:

As the name implies, this card facilitates contactless payment. The card does not need any physical contact with any medium, such as card readers or any digital interfaces. Such cards use radio frequencies or NFC technologies for establishing a wireless contact between any card and the intention for which you are making use of it.

Hybrid cards:

A card is a mix of both contact and contactless smart card. They possess both technologies for functioning in dual capabilities.

Based on configurations also, there are three main kinds of smart cards:

Memory cards: These cards are used temporarily, and their memory capacity is deficient. This is why their functions are limited for some activities, such as reading and writing data and storing some data needed for some functions.

Microprocessor cards are like mini-computers, which are so portable that you can hide them in your pockets. They have ample memory space for storing vast amounts of data.


The smart card payment system is a significant technological advancement, offering users high security and convenience. It simplifies shopping, reducing the need for cash and promoting portable payment options. Smart cards will continue to play a crucial role in technology for years to come.

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