Smart Cards are being deployed worldwide for a variety of applications in both financial and non-financial sectors. The Government and Government Organizations in many countries are also coming forward to introduce Smart Cards in their various operations. With the technological advancements the Smart Cards are becoming cost effective, and it is becoming feasible to incorporate multiple applications on a single card. The Smart Card technology is promising to empower e-citizen with a multi-purpose transacting device in near future.

"Smart cards are gaining pre-eminence as the ultimate portable and network personal computers of today. With the growth of e-commerce , card based personal systems will remain the most common online payment method. Businesses and countries that do not use these technologies are unlikely to capture global markets. With the availability of better security technologies and lower costs, smart cards have the potential for use in many applications such as the banking retail payments, vehicle registration, internet payments, citizen ID, e-governance, driving license , health records etc. Deployment of smart card in welfare schemes such as public distribution systems would ensure timely and efficient benefits to the targetted audience .

There is a large local market for smart cards in India and an integrated approach for widespread deployment of smart cards is being conjectured with active participation from major user departments , financial institutions and industry. In this context , and also to ensure interoperability , it is necessary to define common standards for multi-Application Smart Cards in India.

"It was decided to set up a committee under the Chairmanship of Secretary, MIT to examine issues related to deployment of smart cards, identify applications, infrastructure requirements � including banking and payment infrastructure � and evolve standards to ensure interoperability. The Committee would examine international best practices and define the standards for the terminals and the security requirements to eliminate risks of frauds, as far as possible and thereby ensure widespread adoption of smart cards in all sectors of the economy. The Committee would also deliberate on the issue of type approval and identify areas where the local industry can play a major role. . It was decided to set-up two sub-committees to evolve a comprehensive framework to facilitate deployment and manufacture of multi-application smart cards in India. The first sub-committee (Sub-Committee - I) would focus on a common identification system, and non-financial applications in Government sector. The second sub-committee (Sub-Committee - II) would focus on Financial and Banking applications in both public and private sectors, as well as issues pertaining to non-financial, non-Government applications. The Sub-committee-II would also examine the issues of interoperability and standards
[source - Website of Ministry of Information Technology]

The main committee and sub-committee have been conducting deliberations. The main committee had three meetings. The minuts of the meetings can be viewed from the Ministry's website at URL - http://www.mit.gov.in/smartcard/index.asp.

After publishng the minutes of these meetings the Government have invited suggestions from interested members ofthe public. These suggestions are to be submitted before 15th DFecember 2002.

While the project is therefore awaits finalisation, as per informtion gathered the following proposals have received a concrete shape

Sources in DIT also revealed that while a broad consensus has already emerged during the October 31, 2002 meeting of the inter-departmental committee on the guidelines that would determine smart cards operation parameters, the Smart Card Initiative committee (SCIC) is currently busy sorting out complicated issues like standards and specifications for smart cards and terminals.

It is also working on cryptography issues, standards for interface and issues related to interoperability. According to a senior official in DIT, the committee needs to address these issues in advance in order to ensure that once the project is rolled out vendors do not start shipping products that are unable to talk to each other.

The inter departmental committee, including RBI, Institute for Development and Research in Banking Technology (IDRBT), IBA, Election Commission of India, Ministry of Finance, Indian Railways, Ministry of Surface Transport, Bureau of Indian Standards and also representatives from the Army, IT industry, smart card forum and IIT also agreed that all banking and financial application related smart cards need to be secured using PKI-based system.

However, members of the committee also agreed to the need for setting up a key managementinfrastructure for non-PKI multi application smart cards. According to sources, the SCIC has recommended that while PKI enabled Smart Cards should be used during the initial period, the issue of setting up a key management agency for symmetric cards should be reviewed later.

The RBI, in collaboration with the Department of Information Technology would soon be launching a pilot project for smart card implementation in India. The e-purse project is part of the multi-function smart card project under active consideration by the ministry, wherein a single smart card can be used for a host of applications like driving licenses, electricity and water bills or even taxes. RBI plans to roll out these services as part of its financial application based pilot project for smart card implementation in India

RBI has also decided to issue a special directive thereby enabling 22,500 PCOs across the country to act as multifunctional service delivery points (SDPs). As per the earlier RBI guidelines, only banks can function as SDPs. However, the decision to amend this rule was taken keeping in mind the high penetration and accessibility factors of PCOs that is essential for the success of this roll out. The project is primarily aimed at benefiting the poorest of the poor

According to V B Taneja, senior director, DIT and director of the smart card project, the pilot project proposes to upgrade 22,500 PCOs to act as multifunctional service delivery points (SDPs) having smart cards based payment system and acting as franchises of various banks. Each PCO booth would be upgraded with a telephone terminal, an Internet appliance, and two pocket sized e-purse-only terminals.

The respective PCO owners will have accounts with a bank where they will deposit the cash thus collected, and will be paid a service charge in lieu. Industry sources reveal that while the price of a 32-KB smart card is around Rs 200, an offline card reader can be cost around Rs 18,000, depending on individual vendors and systems integrators. While the cost of upgradation and equipment will also have to be borne by PCO owners, consumer would need to pay for the one time cost of the card," said Taneja.

According to IT Secretary Rajeev Ratna Shah, the pilot project is expected to launched across 63 cities in the country by early next year. The e-purse project is part of the multi-function smart card project under active consideration by the ministry, wherein a single smart card can be used for a host of applications like driving licenses, electricity and water bills, or even taxes; and simultaneously can also be used as an e-purse. However, the pilot project will see only the e-purse function being activated, other utilities like driving license, or payment of pensions using the same card to trigger off after the completion of the pilot, circa 2004.

The committee also discussed the ID number schema proposed by a sub-committee under the chairmanship of Dr Vivek K Agnihotri, Additional Secretary, DAR&PG. Based on the sub-committee's report, SCIC also recommended that while the ID number should be non-significant, the issuing office number should definitely be part of the ID number.

Keeping a provision for 9999 centers, the SCIC also decided to have a 12-digit ID number with 4 digits for issuing office number and 8 digits for person's ID. This, according to a committee member, is also aimed at reducing the ID number size from 16 to 12 digits. Other information like place of birth, state or village code will be kept as fields of record. The committee also suggested that ID cards should be issued after authorization from a separate authorization center, which could be based on the place of birth.

The committee has also suggested that the smart card reader should be an offline. This, will help bypass the capital investment that an online device would entail. It would have two slots-one for the user's smart card, and the other for the owner's smart card. The SCIC estimates that an average of 50 such cards would be issued per SDP-a total issuance of 1,125,000 cards during the pilot. SCIC has also recommended that two types of interoperable cards with PKI-full function debit (e-purse, direct debit and ATM) and e-Purse-only cards be deployed for the project.

Talking about back-end requirements for such an implementation, managing director of Smart Chip and a member of the SCIC Sanjeev Shriya said, "It could be anything-from Oracle / DB2 or UNIX, but they would be platform-agnostic. Ministry sources also inform that interoperable interfaces will be used for financial and multiple applications, EMV for debit, CEPS for e-purse and global platform for post-issuance will be demonstrated in the project.

The project also aims to use biometrics based PKI and PSTN lines for dial up access, DSL based broadband internet access, wireless internet access using variants of GSM/CDMA and WLL, leased lines, ISDN and V-SAT links, among others.

According to Shah, the total duration of the trial run or the pilot would be 11 months-consisting of one month for deployment of network and back-end systems, three months for proof-of-concept phase on smart card based payment systems and remaining seven months for the deployment phase. While the committee has recommended that the deployment phase should be completed by the end of FY 2002-03, sources in the ministry point out that a project of such magnitude may suffer several unforeseen snags, and specific details like the roll out time may change drastically.

The final shape of the project will be announced soon. "The outline of the project and the reports of the various smart card committee meetings have been posted on the ministry of information technology website for suggestions from the smart card industry and the masses. Let us evaluate these suggestions first-and if necessary incorporate these suggestions-only then will we be in a position to formally announce it," (Mr.Taneja, Secretary, DIT).