Credit cards as we know them have their days numbered. Its characteristic magnetic strip, whose use has fallen in recent times in favor of other technologies such as the chip or contactless wireless payment, will disappear in a matter of a few years.
The Mastercard Company has been the first to announce that, starting in 2024, it will begin to get rid of the magnetic stripe on its cards.
As explained in a recent statement, this elimination is due to the fact that both consumers have changed their payment habits and the development of new technologies. “Today’s chip cards are powered by microprocessors that are much more capable and secure, and many are also embedded with small antennas that enable contactless transactions. Biometric cards, which combine fingerprints with chips to verify the cardholder’s identity They offer another layer of security,” they indicate from Mastercard.
For this reason, “by 2033, no Mastercard credit and debit cards will have magnetic stripes,” the entity has detailed.
Specifically, the magnetic stripe will begin to disappear from Mastercard payment cards in Europe from the year 2024. In the US, however, it will not be until 2027 when banks are no longer required to issue chip cards with a magnetic stripe. With these dates, the company seeks to give several years of margin to companies to adapt their customers’ payment methods.
How will payments be in the future?
The payment of any purchase by different means, from wallets incorporated in smartphones to mobile applications such as Bizum, has experienced a boom in recent years, to the detriment of cash payments.
“These new technologies are much simpler to enable, making them more accessible to even the smallest merchants,” explains Mastercard.
According to company data, in the first quarter of 2021 it registered one billion more contactless transactions compared to the same period in 2020, and in the second quarter of 2021, 45% of all in-person payment transactions nationwide worldwide were contactless.
Likewise, EMV chip technology is also evolving to become even more secure. This “will help protect cardholders and merchants from fraud for decades to come with the same half-second, tap-and-go experience today, and without any physical changes to digital wallets, contactless cards and point-of-sale terminals.” sale,” adds Mastercard.
Magnetic stripe was pioneered in the early 1960s by IBM, allowing banks to encode card information on magnetic stripe laminated to the back.
“This technique was already being used for audio recordings and computer disk storage before it was brought to cards,” they indicate from Mastercard.
This invention paved the way for electronic payment and later came chip cards, which offered greater security while making it easier for businesses of all sizes to accept cards.
However, since a global EMV chip technology standard was introduced in the late 1990s, EMV cards have started to become the preferred form of payment, to the point where they are now the 86% of card transactions worldwide, says Mastercard.