Indonesian smart cards apparently not that smart

Indonesian smart cards apparently not that smart

By T. Sima Gunawan

JAKARTA (JP): What do rich people have in their wallets or purses? A lot of money, right? Wrong. They do not need to carry much cash anymore because a credit card can take its place in business transactions.

More and more people worldwide are using credit cards as they provide greater convenience. However, soon credit cards alone will not be enough.

Two of the world's largest credit card companies, Mastercard and Visa, are planning to develop global smart cards, starting with Australia. Visa will start issuing smart cards middle of this year, followed by Mastercard at the end of the year.

A smart card will be embedded with a microchip, which will be able to store a lot of information. More than a magnetic-strip credit card, it will function as a debit card as well. In addition, it will serve as a portable bank account which allows the holder to deposit money on the card, which can be used to pay small items now bought with cash.

Compared to the plain credit cards, smart cards are obviously more secure.

"You can't duplicate smart cards," stressed Terry E. LeDell, Senior Product Manager of DataCard, the world's leading plastic card supplier.

Along with DataCard Vice President Woodrow J. Frost, he came from their Minneapolis office last week to talk about the technologies behind plastic cards. A number of both private and government institutions attended the two-session presentation organized by the DataCard distributor in Indonesia, PT Bauma Smarti Teknika.

"Credit card forgeries in the United States alone inflict $1.6 billion a year in losses," LeDell told The Jakarta Post.

Smart cards are not for financial institutions only. In the United States, chips are installed in health care cards and smart cards are issued to replace food stamps.

"You can get information from a smart card, or give it information. For example, my medical record can be stored in my health care card, so if I go to a doctor, they can read all of my past illnesses and medicine," LeDell said, adding that the information can be updated anytime.

In the welfare program, the U.S. government has started using smart cards to prevent the abuse of food stamps. "You can sell food stamps and use the money to buy liquor. But since the government put the benefit on chips, you have to go to a store and buy food if you want to get the benefit. The cashier will subtract the food you purchase from the card," LeDell said.

Educational institutions also use smart cards. The Florida State University, for instance, has been using smart cards for three years.

Everyone in the university has a card, which allows them to use it as a credit card or debit card. It also has a bar code to a lunch or dinner, as well as a magnetic stripe for access control, according to LeDell.

The university is also able to trace the card holders and send emergency messages.

"They can send the signal through the computer. So, when you are trying to get through the door, there will be an emergency message on the reader with the red light turned on. As you get the message, you can contact the operator and they will tell you what has happened, whether your dog has died or whether you should call your Mom," LeDell explained.

The cards provide greater security. For example, if someone gets through the front door, the reader will automatically register it. If there is something missing in the locker room, it will be easier to investigate the case because everyone who's been there is recorded.

"Many colleges in the U.S. are using this to transcribe the school records, the attendance and how much you pay for tuition. Well, you can also put money in it to buy cokes or candy bars," LeDell said.

Not really smart

What about Indonesia?

There are at least three banks which have issued "smart" cards. Bank Dharmala, Bank Surya Putra Perkasa and Bank Eksport Import.

Bank Eksport Import has EximSmart, which was introduced in 1991. It is like an account book which records the card holder's transaction with the bank. Also, it can be used as a debit card, which is accepted in Pasar Raya Department Stores, Tomang Tol Department Stores and Medika Loka Hospital.

The other smart card is Procard, first issued by Bank Dharmala in 1993. As a debit card, it is accepted by about 50 merchants in 150 outlets in the city. Bank Surya Putra Perkasa has recently joined Bank Dharmala in the issuance of the cards. This will be followed by two other private banks, Modern Bank and Bank Sewu.

Procard holders can draw cash at an ATM. If they want to put money on the cards, however, they should go to the bank.

Well, you might be disappointed because as a smart card, Procard is not really smart. But in a way, Procard is a little more advanced than several other bank cards, which can only be used to withdraw cash. There is also a hope that as it gets older, Procard will become smarter.

"We have a plan to improve the cards, so that in the future card owners can put money on the card at an ATM," Inka, a Procard marketing officer, said.

LeDell predicted that there will be a great increase in the use of smart cards, as well as hologram cards, radio frequency cards and proximity cards, mainly for security reasons. Radio frequency cards and proximity cards do not need any physical contact with the readers. Proximity cards will be effective as entry cards to a building where hundreds of people go in and out.

Another sophisticated way to gain access through a door is by eye scanning.

"They scan the retina in the eye. The blood vessels are different for everybody, like a fingerprint, so they get a different pattern for different people," LeDell said.

"They are working with a red laser, looking at the pattern of your eye, that will become your ID," he added.

He said this method is very accurate, but people do not use it a lot because they don't feel right having a laser scanning their eyes.

Finger prints are also very accurate, but many people raise objections to the storing of fingerprints on data base. "The Civil Liberty Union in the United States is totally against maintaining finger prints on data base," LeDell told the Post.

Hand geometry is less accurate than finger prints, as are signatures.

"If you make a signature, you create a pattern on how you sign your name. If, one day, you don't feel good and you don't sign the same way, you will be denied access," he said.

Hand geometry cannot be totally accurate because when you gain a lot of weight, the geometry can be a little different.

According to LeDell, voice is not accurate as an ID because when people do not feel well, their voices might be different.

Types

In accordance with the development of technology, various types of sophisticated cards are offered with more convenience and security. Clearly, the cost is high.

"You can have this card for 25 cents," LeDell said, pointing at a plain plastic company badge, "but this smart card, with a chip that can keep 8,000 bits of memory, costs $10 apiece."

The access machines are available for hundreds of thousands of dollar each.

LeDell said DataCard has over 90 banks worldwide, including BCA and Citibank Indonesia, using their machines to do photos on ID cards, and 40 customers who are doing driver's licenses, health care cards, member cards, university ID cards and other plastic cards for the government.

"The market for Indonesia is promising," he said.

However, LeDell said DataCard did not expect an instant response from potential buyers, especially the government.

"We just want to give the information that the technology is out there," he said.

High technology allows the issuance of secured plastic cards with various features such as security printing, security inks or optical variable, according to DataCard vice president, Frost.

An intricately interwoven pattern, like the one printed in currency, is an example of security printing. There are also micro printing, difficult to detect with the unaided eye, rainbow printing, which allows one color to merge into another, and latent image, which appears only when viewed at a certain angle.

A commonly used security ink is one which is only seen under ultraviolet light.

An optically variable device can also be used to change the appearance of an image when viewed at a different angle.

"When you rotate the card at 90 degrees, you will see a completely different image," Frost said.

A thorough consideration should be made to select which security features will be applied on the cards, depending on the necessity, he suggested. Periodic evaluations will also be required, to assure security.

"There is no guarantee that a product which is secure today will be secure in the future," he said.

Not only the customers, but plastic card producers need to improve their products because there is always somebody out there trying to break the security.