A smart card is a small, portable device that contains an embedded microchip, which can store and process data. These cards are commonly used for secure transactions, such as in banking, identification, and access control. They can be contact-based, requiring a physical connection to a reader, or contactless, allowing data transfer through radio frequency. Smart cards enhance security by encrypting information and requiring authentication, making them more secure than traditional magnetic stripe cards. They are widely used in various applications, including credit cards, ID cards, and transportation passes, providing convenience and safety for users.