as key stakeholders position for expanding consumer smart card use, according to two Smart Card Alliance studies released today. More than 21 million smart payment cards will be in circulation by the first quarter of 2003, the studies predict.

The latest Alliance white paper, “Smart Cards and the Retail Payments Infrastructure: Status, Drivers, and Directions,” describes the current state of the smart card payments infrastructure in the U.S., discusses the key markets and applications that are expected to drive smart card usage and acceptance and outlines the critical barriers to adoption.

“This past year brought many important infrastructure developments, such as the 300,000 smart card-ready payment terminals shipped in 2001, deployments of infrastructure at leading retail chains, the advance of significant new smart card programs from Target, Citibank and others, and increased readiness at the processor level,” said Randy Vanderhoof, executive director of the Alliance. “This report gathers in one place all of the information regarding the readiness of the U.S. payment and retail infrastructure to accept smart cards today, and identifies what remains to be done.”

Reinforcing the importance of smart card research to the retail industry, a recent report from the Food Marketing Institute stated, “Smart cards are almost certain to play an increasing role in the way which grocers do business in the not-so-distant future. By designing new payment and loyalty programs in stores that take full advantage of smart cards’ strengths and capabilities, grocers can ensure that they are smart about smart cards before consumers drive the demand again.”

The Alliance also released a case study entitled “Ohio EBT Smart Card Program.” It discusses the implementation and results of the statewide, offline EBT smart card program in Ohio in which over 375,000 smart cards are active, and more than 10,000 terminals are in use at over 5,000 retail locations.

“This case study shows that thoughtful business application of a leading- edge technology can provide advantages to everyone in the benefits supply chain,” said Bruce Philpot, managing director of the Center for Automatic Identification at Ohio University. “The Ohio EBT smart card program is e- government at its finest. Individuals and families who participate get greater convenience and dignity, and the state reduces fraud and simplifies benefits distribution for itself and its participating merchants. It proves that intelligently applying the right technology, in this case smart cards, can benefit all of the stakeholders in a government managed payment system.”

The two reports, written for executives and managers, are available to both members and non-members at no charge at http://www.smartcardalliance.org.

The Alliance’s Terminal Infrastructure and eTransaction Task Force, with over 30 contributing members, worked on the project. Alliance members from nine organizations, both public and private, were contributors in the development of the retail payments infrastructure white paper including representatives from ACI Worldwide Inc., ADB, First Data, Hypercom, MasterCard International, NTRU Cryptosystems, Inc., U.S. Office of the Comptroller of the Currency, SchlumbergerSema and Visa U.S.A.

Citicorp Electronic Financial Services, Inc. developed the Ohio EBT case study for the Alliance.

About the Smart Card Alliance
The Smart Card Alliance is a not-for-profit, multi-industry association working to accelerate the acceptance of smart card technology.

Through specific projects such as education programs, market research, advocacy, industry relations and open forums, the Alliance keeps its members connected to industry leaders and innovative thought. The Alliance is the single industry voice for smart cards, leading industry discussion on the impact and value of smart cards in the U.S. For more information please visit http://www.smartcardalliance.org .

Contact:

Debra Montner
Montner & Associates
(203) 226-9290
dmontner@montner.com


Katie Wittcamp
Smart Card Alliance
800-556-6828
kwittcamp@cmasolutions.com