Credit card magnetic stripes get sleeker, new design

After more than 40 years of relying on the same basic magnetic stripe technology, the humble plastic credit card is about to get smart. From cards with buttons and displays on the front to those that can be programmed to keep you on a budget, a number of new innovations are in the works.

Europe moved to smarter, chip-enabled cards years ago, but the size of the magnetic stripe infrastructure in the U.S. has made that type of widespread change difficult, since millions of new card readers would be required. So in a new twist, some companies are now creating interactive cards that work with ordinary magnetic stripe readers.

Citi’s new 2G card, for example, has a programmable magnetic stripe and buttons on the front that let customers choose before they swipe whether they want to pay with credit or reward points. And just this week, MasterCard Worldwide announced the U.S. release of a card with a tiny LCD screen that will display a one-time passcode, designed to make online shopping more secure. Other issuers are piloting plastic cards that can access multiple accounts or require you to enter a PIN to use them.

The newfangled cards are being developed even as a spate of recent announcements indicate that mobile payment devices are getting closer to becoming a reality, hypothetically making the plastic card itself obsolete. Banks, cell phone providers, Google and Apple, to name a few, are reportedly working on mobile payment systems that rely on near-field communication (NFC), a short-range wireless technology that allows devices to transmit encrypted data.

Tags: Credit cards

Posted by FinanceAZ on Apr 1 2011. Filed under Credit cards. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry