The Connexions Card looks like a plastic bank card but contains a chip that stores basic information about students, such as their date of birth, and has a colour photograph.
The smart card has been piloted in the north east and will be available nationally in October, in what is the largest project of its kind in Europe. Some 80,000 cards are being issued and 1.7 million are expected to be in circulation when the scheme is fully operational.
Capita is managing the project, which is worth pound;110 million over seven years, and thought to be one of the first publicprivate partnerships in education.
Students aged between 16 and 19 will earn 100 points for a full week's attendance at their learning centre by inserting their cards into a reader at each class. Only unauthorised absence is penalised.
This information will be used to control payment of education maintenance allowances to students.
The points can be used to claim a range of rewards, such as computer games, cinema tickets or sporting events by making a selection on the Connexions Card website. The site will also offer information about jobs, courses, training and allow users to create an online CV.
Students at schools and colleges not participating in the scheme can still use their card to claim discounts offered by an ever-growing number of retail outlets.
Because the information held on the card takes up only a fraction of the memory on the chip, Capita's John Warwick said there was much potential for more sophisticated use in the future. It could be an "e-purse" to let students pay for food and bus or train fares without cash, or to control access to college buildings.
It would also be possible for colleges to use the card as part of their own registration systems.
He acknowledged that data protection was a very important issue. Personal information will not be passed on to firms participating in the discounts or rewards schemes unless students give their consent.
According to Warwick, the card's ability to serve as proof of identity alone would ensure its success. He said several big retail chains were interested in using the card, for example, to ensure cigarettes were sold only to over-16s.