The acronym SIM stands for Subscriber Identification Module. A SIM is used to authorise a subscriber to access a mobile network. SIMs can come in many form-factors, including cards and chips.
Any device that wants to communicate using a cellular network needs to demonstrate that it is authorised to do so: that its owner is one of the network provider's customers, or of another provider that has a roaming agreement with the home network. The SIM in the device contains the information used to grant — or reject — access to the network.
All SIMs are microchips. Most are embedded in a small plastic card, of which there are four sizes: standard, mini, micro, and nano. Large, credit card-sized standard cards aren't generally used these days, but you will almost certainly have taken one of the smaller cards out of a larger one to slot into a phone or tablet.
Some device have built-in SIMs, which are just SIM chips mounted on the device's circuitboard. This is known as the 'MFF2' form-factor.
Originally, SIM hardware and software were considered a single entity. Nowadays, the SIM functionality is an application running on more general purpose hardware called the UICC, or 'Universal Integrated Circuit Card'. This is the platform on which Twilio Super SIM operates, to deliver its ability to switch between global cellular networks. Check out Super SIM's Multi-IMSI Applet to find out how it works its magic.