Smart-cards-a cost-effective solution against electronic fraud

Smart cards have a tremendous advantage over their magnetic strip ancestors, of being able to execute cryptographic algorithms locally in their internal circuitry. This means that the user's secrets (be these PIN codes or keys) never have to leave the boundaries of the tamper resistant silicon chip, thus bringing maximum security to the overall system in which the cards participate. Smart cards contain special purpose microcontrollers with built in self programmable memory and tamper resistant features intended to make the cost of a malevolent attack far superior to the benefits. The paper is both a survey of the existing components, their applications and an attempt to describe some of their possible evolutions.