For many decades, the magnetic stripe has been one of the most important features of bank cards. It should now gradually disappear from credit and checking cards. After this, the focus will be on contactless payments.
Credit and checking cards usually have a magnetic stripe on the back.
The black or white bar allows consumers to swipe their cards at the payment terminal and accept payments. However, as contactless payments are becoming more and more important, magnetic strips are now taking a back seat.
Payment provider MasterCard is therefore taking a revolutionary path: the magnetic stripe is rapidly disappearing from banks and credit cards. The provider wants to do without it throughout Europe by 2024. The last card with a magnetic stripe will go into production in the United States in 2029. Since bank cards are usually valid for four years, cards with magnetic strips should no longer be in circulation from 2033 onwards.
What will change for bank customers?
The appearance of classic credit and bank cards has changed a lot over the years. With the elimination of the magnetic stripe, it’s not just the back that changes. The latest bank cards show one important detail: The front of the card is reduced to three important pieces of information: bank name, owner, and card type (such as MasterCard, Visa or Visa Debit).
The most important information such as bank card number, security feature, IBAN, expiration date, security identifier and symbol for “contactless payment” are then followed. The signature field can also be found on the back, which eventually replaces the magnetic stripe as well.
This also makes it easier for bank customers to store their cards on their smartphones. Instead of scanning back and forth, in many cases users only have to scan backwards. The system then automatically recognizes all the important data.
Read on topic:
Magnetic Stripe: It’s Over 60 Years Later!
In the United States, bank cards with magnetic strips were first issued in the 1960s. Until it was introduced, dealers had to use lists to check whether customers were creditworthy. They get these lists once a month from the respective credit institutions.
Banks were able to encode the card’s data onto a magnetic stripe that was laminated to the back of the card. Consumers had to swipe their bank card when they wanted to use certain products or services.
In the 1990s, the chip rapidly replaced the magnetic stripe. The customers then had to insert their cards into the appropriate devices. Meanwhile, only credit and Giro cards are to be issued. Many of these cards have small antennas that enable contactless payments. Apart from the chip, the biometric cards provided with fingerprint will also provide more security.
