1 smartcard

5. Providing Value-Added Services
One of the most compelling benefits of smart cards is the potential for packaging and bundling various complementary services around basic mobile telephony services. These services can greatly reduce churn and increase usage and brand recognition (see Figure).
Figure Service Bundling with Smart Cards

The SIM card’s chip can be programmed to carry multiple applications. The activation of new applications can be downloaded to the card over the air, in real time, thereby reducing the time (and cost) to market.
Providing value-added services such as mobile banking, Web browsing, or travel services creates a high cost of exit for the customer. Long-distance companies have successfully used joint programs with airline companies to ensure the long-term loyalty of their customers. The more services a customer receives, the more difficult it is for the customer to leave the service provider. Smart cards provide an excellent vehicle for surrounding the core wireless service with these other valuable services, and packaging- and service-bundling opportunities are numerous. Examples of such opportunities are as follows:
• GSM Cellnet and Barclaycard, Europe’s largest credit-card issuer, developed a wireless, financial-services smart card. The SIM card activates the user’s Cellnet GSM phone and also provides a Barclays services menu. The services available via this alliance include the following:
o access to Barclays credit-card information
o access to Barclays checking-account information
o access to Barclays customer care
• Initially, the Barclaycard services will be provided via live customer service representatives who will answer calls from customers. Future enhancements will enable users to pay household bills, shop, and access financial information services while on the move.
• Swedish bank PostGirot implemented a utility bill–payment application in the Telia Mobitel SIM card. Mobile phone users accessed the service by simple menu navigation and keying information such as origin and destination bank-account numbers, date of payment, and amount, which enables them to pay their utility bills away from home.