Abstract
Over the past few years, smart cards have achieved a growing acceptance as a powerful tool for security, identification, and authorization. Financial card issuers are moving to replace magnetic stripe cards with chip cards to reduce counterfeiting and fraud. The increasing computational power placed on the chip along with advances in cryptography has made the smart card a very powerful tool for identification. The advent of multi-application smart card operating systems for both contact and contact less applications has put smart cards on the edge of information technology. This paper features a 3-tier smart card secure solution for a novel prepaid electricity system. The proposed system uses an IP-based controller in addition to a power meter, providing efficient online control of the amount of electricity consumed by the user. The user will be notified if his credit balance goes below certain threshold.