According to Farmer, using smart cards for stored value, as in Manhattan, when a well-developed infrastructure for payments involving credit and debit cards already exists never made a lot of sense. Where smart cards are expected to catch on is in the field of security and authentication for electronic-commerce transactions. As electronic commerce becomes more sophisticated, involving everything from applications for mortgages to tax filings, users are going to require greater levels of security to ensure that their transactions are protected from tampering. More importantly, parties involved in sensitive transactions will want to be sure the other party is who he or she claims to be. Digital signatures can provide this level of authentication and security through encryption, but it requires the use of software on the open Internet as well as an infrastructure for managing the public keys that allow thousands, perhaps millions, of people to electronically sign documents and forms.
Smart cards offer a way around the software and infrastructure problems.
Smart cards make it easy to digitally sign documents, and they are fast. Cards also are safer than software solutions because the user carries his encryption information with him. It's not stored on a hard drive, therefore vulnerable to crackers. Finally, smart cards are portable, allowing a user to maintain digital security and identity regardless of location. With smart cards, a user can send digitally signed e-mail from different computers.