The smart card market is projected to reach USD 16.9 billion by 2026 from USD 13.9 billion in 2021; it is expected to grow at a CAGR of 4.0% from 2021 to 2026. Major drivers for the growth of the market are surged demand for contactless card (tap-and-pay) payments amid COVID-19, proliferation of smart cards in healthcare, transportation, and BFSI verticals, transportation, and BFSI applications; increased penetration of smart cards in access control and personal identification applications; and easy access to e-government services and risen demand for online shopping and banking. Moreover, new mode of information security of users enabled by block chain and adoption of smart cards in populated countries of APAC act as growth opportunities for developers of smart card.
A dual-interface
smart card is embedded with a chip that allows the card to be used in both
contact and contactless transactions. Dual interface cards allow card readers
to obtain the card’s identifying information through the use of a single chip.
The chip component of a dual interface card is typically embedded in an outer
layer of PVC, polycarbonate, or polyester. Dual interface chip cards provide
greater payment processing convenience. Dual interface smart cards are likely
to witness high growth in the coming years. These cards, including both contact
and contactless interfaces, enable compatibility with any card reader or POS
terminal. These cards are integrated with RFID technology and EMV chips and
allow contactless payment. The faster payment processing nature of these cards
reduces waiting time for customers in a queue.
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MPU Microprocessor-based smart cards have a microprocessor
embedded onto the chip in addition to memory blocks. This type of card can be
used for more than one function and is usually designed to enable adding,
deleting, and otherwise manipulating data in memory. Features such as faster
processing, large memory storage, and enhanced security have enabled
microprocessor-based smart cards to penetrate conventional smart card
application areas and reach newer application areas, such as NFC and M2M
communications. Increasing banking frauds and rising concern towards security
has led to the rapid growth of the market for microprocessor-based smart cards.
As the security of customer credentials is of utmost importance in the BFSI
sector, microprocessor-based smart cards are expected to witness high demand in
this sector in the coming years.
Smart card have various vertical, which include BFSI,
telecommunications, government and healthcare, transportation, education,
retail and others. Among vertical, the government and healthcare segment of the smart
card market is projected to grow at the highest CAGR during the forecast
period. With globalization, developing economies in APAC and RoW are
expected to digitize their government institutional processes to cope with
rising competition. A part of this digitization process involves converting
paper-based documentation into paperless or smart card-based documentation.
Therefore, smart cards are being used by governments to issue identity cards to
individuals, which contain all the details of individuals. The Aadhaar card
scheme in India is one such example, which helps citizens easily verify their
legitimacy for availing healthcare, international travel, and other government
benefits.
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