Mastercard signals end of magnetic stripe on credit cards
Mastercard plans to phase out magnetic strips on credit and debit cards by 2033 due to the rise of other payment technologies, something that could change the appearance of the physical Apple Card.
The thin magnetic stripe on the back of a credit card is a staple of its design, with it being used since 1960 to handle payments at merchants around the world. However, changes in consumer payment habits has Mastercard considering the demise of the magnetic stripe.
From 2024, newly-issued Mastercard credit and debit cards will not be required to have the stripe at all in most markets, the payment network processor advises. By 2033, there won't be a Mastercard credit or debit card with a magnetic stripe at all.
As Apple Card uses Mastercard as its payment network for the physical card, it's possible that Apple could be among the earliest to remove the stripe, in favor of a cleaner appearance for the already-minimalist card.
The company cites the shift in consumer payments away from the stripe in favor of chip-based purchases and contactless payments, such as mobile payment systems like Apple Pay, as being behind the change.
![An example of a credit card design without the magnetic stripe [via Mastercard]](https://photos5.appleinsider.com/gallery/43815-85221-stripeless-white-xl.jpg)
An example of a credit card design without the magnetic stripe [via Mastercard]
In a December survey, more than half of Americans prefer using a chip card payment at a terminal rather than any other payment system, followed by contactless payments. Only 11% said they preferred to swipe their card, a figure that dropped to 9% for those with experience using contactless payments.
Another survey in July determined 81% of American cardholders would be comfortable with using a credit or debit card without the stripe, and then 92% would increase or keep using their cards if the stripe disappeared.
Mastercard's timeframe for the changes sees the stripe's disappearance starting 2024, with markets like Europe with high chip usage being the prime candidates. Banks in the United States won't be required to issue chip cards with a magnetic stripe from 2027.
No new Mastercard credit or debit cards will be issued with a magnetic stripe by 2029, the company reckons The exception would be prepaid cards in the U.S. and Canada which would continue to use the stripe for a while longer.
Read on AppleInsider
The thin magnetic stripe on the back of a credit card is a staple of its design, with it being used since 1960 to handle payments at merchants around the world. However, changes in consumer payment habits has Mastercard considering the demise of the magnetic stripe.
From 2024, newly-issued Mastercard credit and debit cards will not be required to have the stripe at all in most markets, the payment network processor advises. By 2033, there won't be a Mastercard credit or debit card with a magnetic stripe at all.
As Apple Card uses Mastercard as its payment network for the physical card, it's possible that Apple could be among the earliest to remove the stripe, in favor of a cleaner appearance for the already-minimalist card.
The company cites the shift in consumer payments away from the stripe in favor of chip-based purchases and contactless payments, such as mobile payment systems like Apple Pay, as being behind the change.
An example of a credit card design without the magnetic stripe [via Mastercard]
In a December survey, more than half of Americans prefer using a chip card payment at a terminal rather than any other payment system, followed by contactless payments. Only 11% said they preferred to swipe their card, a figure that dropped to 9% for those with experience using contactless payments.
Another survey in July determined 81% of American cardholders would be comfortable with using a credit or debit card without the stripe, and then 92% would increase or keep using their cards if the stripe disappeared.
Mastercard's timeframe for the changes sees the stripe's disappearance starting 2024, with markets like Europe with high chip usage being the prime candidates. Banks in the United States won't be required to issue chip cards with a magnetic stripe from 2027.
No new Mastercard credit or debit cards will be issued with a magnetic stripe by 2029, the company reckons The exception would be prepaid cards in the U.S. and Canada which would continue to use the stripe for a while longer.
Read on AppleInsider
Comments
Yeah, it's a slow crawl, but at least in parts of the US I still encounter POS checkouts, gas pumps, and mom & pop stores/restaurants that don't have chip readers. Same deal with individual sellers at fairs, farmers markets, flea markets, etc., who are using older Square swipe readers. To calibrate the slowness of the crawl in the US, I know that more than 10 years ago I had problems with my company issued credit card when traveling in Europe and Asia because it didn't even have a chip in it and at the time even coffee kiosks had chip readers.
Chip and Pin works best for large transactions. Sometimes, if the chip has a problem (usually just dirty - rub it for a second) it'll say to use the magstripe, but that has reduced security - if you try the magstripe first the terminal will say NO! Use the chip! Some business cards still use the magstripe rather than the chip. Presumably, they think staff can't remember PINs.
Tap has limits on the transaction amount, except for debit (was $100, often $200 now). For Debit it can be set by the cardholder and the bank, or the person who stole the card and the bank. And then the store gets stuck with a fraudulent transaction chargeback because there is no security on tap and that's somehow the store's fault.
Here in Yurp, it's damn near 100% contactless. I took it a step further, I am one of the seeming few who pays with their phone. But it works fine, I have yet to find the store that cannot take Apple Card transactions. Can't say that in the US, contactless payment is very much hit-or-miss as far as acceptance by merchants.
Where I live now, many people still take out their bank card and wave it at the terminal, but NOBODY swipes a card here.
Who’s Responsible for Fraud with EMV Cards in the U.S.?
For the consumer, nothing really changes when it comes to fraud liability with EMV cards. You won’t be held liable for fraudulent transactions in most cases, as long as you alert your card issuer.
Liability for fraud usually rests with the card issuer or payment processor, depending on the specific terms of the account. However, since the transition to EMV technology, fraud liability now lies with the “least-EMV compliant party,” which in some cases might be the merchant. This basically means that if the merchant didn’t install a new EMV system and people are forced to use the mag stripe, the merchant will be held liable for fraud if it occurs.
There are currently four important dates in what is known as the “EMV liability shift:”
So October 2020 was the new date at which all card present transactions in the U.S. will be held to these standards, including automated fuel dispensers.
In the old days, if all broke down, there were the raised numbers and letters for carbon-copy credit card transactions, which are pretty much history by now.
They better figure out a way to make card numbers indestructible, since in newer cards they wear off.
Or skip the card and just use my watch, which works at a lot of places in the US now.