How payment cards are evolving into mini computers

Leading payment card companies roll out products with advanced features like user interactiveness and biometrics.

Two of the largest payment card providers, Mastercard and Visa in collaboration with their partners, have unveiled products with advanced features. These products aim to improve user experience as well as add additional layers of security. Equipped with a card-programmable magnetic stripe, card-programmable EMV chip, and a card-programmable contactless chip, Mastercard's new product comes with buttons that users can press for different payment types. It has features like LEDs which light up, in addition to an embedded cellphone antenna, to make it interactive for a user. 

Our card which we launched in India recently has three buttons on it. One button for credit, one for points and the final for paying EMI installments. This technology works with a magnetic stripe, EMV, and contactless POS terminals and you do not have to change the software or educate the merchant.

J_m

                                                     Jeffrey Mullen, CEO, Dynamics

"In India, we have recently launched our interactive card in collaboration with Mastercard and IndusInd Bank, and the card has three buttons on it. One button for credit, one for points and the final one for paying EMI installments. This technology works with a magnetic stripe, EMV, and contactless POS terminals. You can easily use it at any terminal where Mastercard is accepted as it changes the information accordingly. You don't have to change the software or educate the merchant. Other payment technologies don't provide such different ways to pay," said Jeffrey Mullen, inventor, and CEO of Dynamics, a manufacturer of user-interactive cards with advanced functionalities.

Improved layer of security

The interactive card developed by Dynamics for Mastercard holds no information while it is switched off and is considered safe from fraudulent activities like skimming. "We have designed the interactive card in a way that when the card is switched off and sitting in your pocket, no one can place a wireless skimmer and read its information because, at that point, there is no information in the card. We also have a different payment card that requires a password," said Mullen. 

Visa, on the other hand, has rolled out a biometric authentication payment card aiming to replace the PIN altogether.  Visa has said that it has begun pilots with Mountain America Credit Union and Bank of Cyprus for an EMV dual-interface payment card. These are the first commercial pilots to check on-card biometrics for contactless payments, says the company. “The world is quickly moving toward a future that will be free of passwords, as consumers realize how biometric technologies can make their lives easier,” said Jack Forestell, head of global merchant solutions, Visa in a press release.

“We see a very exciting future for healthy competition among cards, applications and various modes of payment. Innovative cards with security, and various options for payment are needed to stay relevant in the changing market“.

DD Mishra

                          D.D Mishra, Research Director, Gartner India

The new payment cards have a significant edge over traditional payment cards as value addition has been long required in order to strengthen the credit/debit card infrastructure, both in terms of ease of use and safety.

"These payment cards add more features on top of current cards around security, convenience, and options. For example, biometrics is one such option which is being tried. As per information available in public domain Visa, partnering with financial institutions, appears to have initiated pilots of a new EMV dual-interface (chip- and contactless-enabled) payment card. These are the first commercial pilots to test an on-card biometric for contactless payments. This will bring much-needed security and build trust which helps increased adoption and penetration. The response to the contactless card in Europe is very encouraging, especially in the UK as per the report published by “The UKCARDS Associations” and other research organizations," says D.D. Mishra, Research Director, Gartner India. 

Adoption of new payment card technologies

The advanced payment card technologies are at a nascent stage and may take some years before getting adopted on a wider scale, although they may still have to compete hard with alternate payment methods, believe experts. In India, experts say the payment infrastructure market is projected to remain competitive, primarily among UPI, payment cards, hardware wallets, and other digital payment methods.

"We see a very exciting future for healthy competition among cards, applications and various modes of payment. Innovative cards with security and various options for payment are needed to stay relevant in the changing market. Given the current scenario and a push for digital payments, it is not impossible to dismantle barriers and make adoption much faster. With innovation in cards, they can stay relevant in the highly competitive industry. The key constraint to this change or innovation will require it to drive the change without disruption in existing infrastructure," says Mishra.

How payment cards are evolving into mini computers

Leading payment card companies roll out products with advanced features like user interactiveness and biometrics.

Two of the largest payment card providers, Mastercard and Visa in collaboration with their partners, have unveiled products with advanced features. These products aim to improve user experience as well as add additional layers of security. Equipped with a card-programmable magnetic stripe, card-programmable EMV chip, and a card-programmable contactless chip, Mastercard's new product comes with buttons that users can press for different payment types. It has features like LEDs which light up, in addition to an embedded cellphone antenna, to make it interactive for a user. 

Our card which we launched in India recently has three buttons on it. One button for credit, one for points and the final for paying EMI installments. This technology works with a magnetic stripe, EMV, and contactless POS terminals and you do not have to change the software or educate the merchant.

J_m

                                                     Jeffrey Mullen, CEO, Dynamics

"In India, we have recently launched our interactive card in collaboration with Mastercard and IndusInd Bank, and the card has three buttons on it. One button for credit, one for points and the final one for paying EMI installments. This technology works with a magnetic stripe, EMV, and contactless POS terminals. You can easily use it at any terminal where Mastercard is accepted as it changes the information accordingly. You don't have to change the software or educate the merchant. Other payment technologies don't provide such different ways to pay," said Jeffrey Mullen, inventor, and CEO of Dynamics, a manufacturer of user-interactive cards with advanced functionalities.

Improved layer of security

The interactive card developed by Dynamics for Mastercard holds no information while it is switched off and is considered safe from fraudulent activities like skimming. "We have designed the interactive card in a way that when the card is switched off and sitting in your pocket, no one can place a wireless skimmer and read its information because, at that point, there is no information in the card. We also have a different payment card that requires a password," said Mullen. 

Visa, on the other hand, has rolled out a biometric authentication payment card aiming to replace the PIN altogether.  Visa has said that it has begun pilots with Mountain America Credit Union and Bank of Cyprus for an EMV dual-interface payment card. These are the first commercial pilots to check on-card biometrics for contactless payments, says the company. “The world is quickly moving toward a future that will be free of passwords, as consumers realize how biometric technologies can make their lives easier,” said Jack Forestell, head of global merchant solutions, Visa in a press release.

“We see a very exciting future for healthy competition among cards, applications and various modes of payment. Innovative cards with security, and various options for payment are needed to stay relevant in the changing market“.

DD Mishra

                          D.D Mishra, Research Director, Gartner India

The new payment cards have a significant edge over traditional payment cards as value addition has been long required in order to strengthen the credit/debit card infrastructure, both in terms of ease of use and safety.

"These payment cards add more features on top of current cards around security, convenience, and options. For example, biometrics is one such option which is being tried. As per information available in public domain Visa, partnering with financial institutions, appears to have initiated pilots of a new EMV dual-interface (chip- and contactless-enabled) payment card. These are the first commercial pilots to test an on-card biometric for contactless payments. This will bring much-needed security and build trust which helps increased adoption and penetration. The response to the contactless card in Europe is very encouraging, especially in the UK as per the report published by “The UKCARDS Associations” and other research organizations," says D.D. Mishra, Research Director, Gartner India. 

Adoption of new payment card technologies

The advanced payment card technologies are at a nascent stage and may take some years before getting adopted on a wider scale, although they may still have to compete hard with alternate payment methods, believe experts. In India, experts say the payment infrastructure market is projected to remain competitive, primarily among UPI, payment cards, hardware wallets, and other digital payment methods.

"We see a very exciting future for healthy competition among cards, applications and various modes of payment. Innovative cards with security and various options for payment are needed to stay relevant in the changing market. Given the current scenario and a push for digital payments, it is not impossible to dismantle barriers and make adoption much faster. With innovation in cards, they can stay relevant in the highly competitive industry. The key constraint to this change or innovation will require it to drive the change without disruption in existing infrastructure," says Mishra.