FORGET the rush to design euro notes and coins, smart cards are being
touted as the best way to bring in Europe鈥檚 single currency. This month, the
European Parliament鈥檚 subcommittee on monetary affairs will release a report
advocating smart cards as a way to to ease the transition.
The report notes that many European countries are already planning to use
smart cards to serve as the identity cards that their citizens carry. It argues
it would be easy to put an electronic 鈥減urse鈥� on the same card.
It also recommends placing a currency converter on the card, so that people
can work out how much they are spending in Deutschmarks or francs, as well as
euros. 鈥淭he big challenge is for consumers adjusting to new prices,鈥� says John
Stevens, the British MEP who is vice-chairman of the monetary affairs
subcommittee.
Advertisement
Stevens also says that banks risk losing control of monetary policy if they
do not actively participate in the global move to electronic cash. Money passed
between smart cards leaves no trace at the banks, unlike cash, cheque or charge
card transactions.
The European Commission should set the standard for a European electronic
currency, he adds. If it controls the technology, it can force participating
companies to report transactions and thereby keep an eye on how much money is
circulating.
Duncan Brown, a senior consultant at market research firm Ovum and author of
a report on electronic cash, says: 鈥淚t鈥檚 an opportunity being missed. The
technology is in place.鈥�