The Western Hemisphere Travel Initiative requires that American travelers returning to the US from destinations in the Western Hemisphere show a “compliant” document to get back into the US.
The State Department has begun accepting applications for the new US Passport Card, which will qualify as a compliant document under the WHTI. The card is intended to facilitate the crossing of the border by border residents - people who live along the Canadian or Mexican border and who cross it frequently. It may be used at land and sea crossings but not by air.
Our passports are now called our passport books, and the card is a passport card. It has an RFID chip and is machine and human readable; two photos are required when applying for the passport card.
Apparently the thought is that the card will be easier to carry in your billfold or purse than your passport.
4 months ago