It’s been a good 50-year run for the magnetic stripe on the back of your credit card, but it looks like its time is coming to an end. At least that’s what Mastercard thinks.
There have been many changes to credit cards over the years, mostly adding new technology while slowly removing things that are no longer needed.
Cards no longer have raised numbers, as hardly any transaction is done by taking an imprint. The Apple Card has gone one step further and doesn’t even print your account number on your card (which is a very Apple move.)
Credit card issuers have stopped requiring a signature for purchases. With no need to compare handwriting at the store, the Capital One Venture X card doesn’t have a space for a signature, which is the first card I’ve seen where it’s removed.
To decrease fraudulent transactions, the credit card companies required banks to issue EMV chip cards to customers (or take the responsibility of paying for fraud themselves.) Chip cards themselves are older technology, initially introduced in the 90s. Most new cards also have contactless technology allowing people to pay by tapping the card instead of inserting the chip.
A growing number of people don’t even carry credit cards, opting to pay with smart enabled devices (phone or watch.)
Credit card companies constantly track transactions and know exactly which form of payment is being used. Mastercard sees a trend and with so few transactions using swipe technology, they’re planning on removing the magnetic stripe from the back of all of its cards.
The magnetic stripe will start to disappear in 2024 from Mastercard payment cards in regions, such as Europe, where chip cards are already widely used. Banks in the U.S. will no longer be required to issue chip cards with a magnetic stripe, starting in 2027.
“It’s time to fully embrace these best-in-class capabilities, which ensure consumers can pay simply, swiftly and with peace of mind,” says Ajay Bhalla, president of Mastercard’s Cyber & Intelligence business. “What’s best for consumers is what’s best for everyone in the ecosystem.”
By 2029, no new Mastercard credit or debit cards will be issued with a magnetic stripe. Prepaid cards in the U.S. and Canada are currently exempt from this change.
Since the U.S. is behind the rest of the world in accepting chip cards and contactless payments, we’ll be able to swipe our cards for a while longer. While I don’t often swipe, small vendors who use a phone with a Square reader (or similar) still use a swipe payment method.
It’s not until 2029 that Mastercard will stop issuing cards with magnetic stripes. Therefore, cards issued before the change could be in circulation until the mid-2030s.
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