To allow local players to participate in the project, Malaysia formulated a bidding policy that forced local and foreign companies to jointly tender for components of the lucrative contract.

The rationale was that Malaysia would get the state-of-the-art technology in exchange for training, employment and technology transfer.

In November 1997, Malaysian Electronic Payment System (1997) Sdn Bhd (MEPS), a consortium of Malaysian banks running a common ATM network, announced the first MPC award. It had adopted Proton technology for the e-cash function which would allow small value transactions on both multipurpose cards.

Proton was developed by Banksys SA of Belgium, and currently has one of the largest user bases in the world with 30 million cards in circulation, accepted by 230,000 terminals in 15 countries.

In February 1998, Proton's local representative company, Triumphant Launch Sdn Bhd, together with its consortium partners, also won the bid for the National Payment and Clearing System for the MPC.

Last September, a technical test for the Proton-based e-cash cards was run during the 16th Commonwealth Games held in Kuala Lumpur.

The sole participating local bank Bank Bumiputra Malaysia Bhd issued 2,000 reloadable cards of RM500 value, and 100,000 disposable cards worth RM50 each, for the purchase of food and souvenir items from participating merchant outlets at the Games Village and around the capital.

In August this year, MEPS will be embarking on a commercial pilot of the Proton e-cash system. About 22,000 reloadable MEPS cash cards will be issued by six banks, and about 100 merchants will be involved.

Delays in awarding contracts related to the MSC and MPC have resulted in smartcard players showcasing their technology elsewhere.

Over the last year, various chip-based cards have popped up in Malaysia. These cards are for use in payphones, handphones, satellite TV decoders, universities, and automatic toll collection. Even national passports are now issued with embedded chips. All the card issuers are touting their wares in the hope that they can buy some mileage for their MPC bids.

Revolution in the making