Mastercard Will Be the First to Remove Magnetic Stripes from Its Credit Cards

[Tsing]

Image: Mastercard



Mastercard announced this week that it will be the first payments network to swipe left on magnetic stripes. The technology has been a staple of credit cards since its inception in the 1960s, but it is finally being replaced thanks to alternatives that provide higher levels of security.



As Mastercard explains in its article, the magnetic stripe is going away due to the ubiquity of EMV chip-based payments and contactless methods (e.g., digital wallets), which are now preferred by an overwhelming amount of users.



According to a recent survey, only 11 percent of Mastercard customers use the magnetic stripe. The company also noted that EMV chips are now used for 86 percent of face-to-face card transactions globally.



Mastercard will begin its process for removing magnetic stripes in 2024. Beginning that year, the payment giant’s credit and debit cards...

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[Brian_B]

I’m … on board.

I really like NFC, but I do wonder how secure it is on a card (I have more faith in it on a phone for some reason - the encryption can be updated and such, but it’s online, so …double edged sword)

the chip can die in a fire though.

 

[Space_Ranger]

The only places I know that don't have chip-readers (EMV Devices), are the ones too poor to do the upgrades needed to support the encrypted chip. It's not all about NFC either. NFC doesn't "need" to be supported, but without the magstripe, you either have to have an EMV reader to go with a different card.

 

[Brian_B]

The only places I know that don't have chip-readers (EMV Devices), are the ones too poor to do the upgrades needed to support the encrypted chip. It's not all about NFC either. NFC doesn't "need" to be supported, but without the magstripe, you either have to have an EMV reader to go with a different card.

The deal with the chip:

my card gets slightly bent, because it’s in my wallet and I have a fat ***.

then the chip readers won’t read it without a lot of fidgeting and fussing. It takes a lot more time than a swipe, and half the time we end up trying the chip 3 or 4 times with no success only to swipe it anyway.

And there is always that dance - leave it in, no pull it out quickly, you pulled out too soon, stick it in further, let is sit for a minute, try it again (phew /wink).

Places with NFC, on the other hand… 9 times out of 10 it beeps and it’s done. On rare occasion I have to try twice (usually the chasier didn’t set it up right), or at some
Gas pumps the NFC doesn’t accept my card type and I have to chip/swipe a card anyway.

 

[MadMummy76]

In my entire lifetime I might have used the magnetic stripe once, and that was in a foreign country. It is an useless feature, one that is easily exploited.

 

[Zarathustra]

The only places I know that don't have chip-readers (EMV Devices), are the ones too poor to do the upgrades needed to support the encrypted chip. It's not all about NFC either. NFC doesn't "need" to be supported, but without the magstripe, you either have to have an EMV reader to go with a different card.

Not too long ago I would have suggested gas pumps would be the problem. There were a lot of legacy gas pumps without chip capability, but at least around here they seem to hvae disappeared one by one over the last couple of years to the point where I don't recall seeing one in a while.

Ever since chips were phased in, mag stripes have just been a backup for when the chip fails. Using the mag stripe was common in the beginning when they first implemented chips, but now I can't remember the last time I had to.

In my entire lifetime I might have used the magnetic stripe once, and that was in a foreign country. It is an useless feature, one that is easily exploited.

Interesting how peoples habits differ.

Prior to the U.S. implementing hips a few years ago, swiping my card using the magstripe was pretty much the ONLY way I ever paid for anything in brick and mortar stores ever since the mid 90's back when I used cash. (I haven't really regularly used cash since ~1995). How did you pay for things before, I don't know, 2015 or so, whenever we went chip?

Since the implementation of chips, now chips are pretty much the only way I ever pay in B&M. For the sake of security though, I wish they had made the PIN mandatory in the U.S. like it is elsewhere. It seems like a very minor inconvenience for the added security it provides, but here they made it optional, and card issuers fear that people will find it too burdensome and just use a different card if they require a PIN, so they haven't required it, which is a shame.

I’m … on board.

I really like NFC, but I do wonder how secure it is on a card (I have more faith in it on a phone for some reason - the encryption can be updated and such, but it’s online, so …double edged sword)

the chip can die in a fire though.

What do you have against using the chip? I mean, it's difficult to imagine anything less painful. Just stick the card in, and the transaction goes through? As previously mentioned, 100% of my brick and mortar payments use the chip. There were some teething issues when it first was implemented, but now it is completely painless, IMHO. It just works.

And what is this NFC thing of which you speak? I mean, I've heard of NFC tech when it comes to cellphones (though I've never actually used it for anything) but you pay with it somehow?

 

[Brian_B]

What do you have against using the chip?

See my second post above - it doesn’t work for me - not some times, but most of the time.

 

[Brian_B]

And what is this NFC thing of which you speak? I mean, I've heard of NFC tech when it comes to cellphones (though I've never actually used it for anything) but you pay with it somehow?

Same thing but now it can be built into the card itself as well.

Tap to Pay - Learn About Contactless Payments

Tap to pay with Visa for a secure, convenient, and touch-free way to make transactions anywhere you see the Contactless Symbol.

usa.visa.com

 

[Zarathustra]

See my second post above - it doesn’t work for me - not some times, but most of the time.

Weird. I literally havent had it fail for me in years, and I use it for essentially 100% of my transactions that are not online.

 

[Zarathustra]

Same thing but now it can be built into the card itself as well.

Tap to Pay - Learn About Contactless Payments

Tap to pay with Visa for a secure, convenient, and touch-free way to make transactions anywhere you see the Contactless Symbol.

usa.visa.com

Hmm.

I generally have pretty low trust for all things wireless, so I have never bothered looking into this.

The cards in my wallet seem to have a little wifi symbol on the back of them, so I'm guessing they are so enabled. I wish I could opt out, as it seems like it might have the potential for abuse.

I do use a faraday cage wallet though, which probably helps (though it does make it more of a pain to use those modern wireless hotel door keys though)

 

[David_Schroth]

Not too long ago I would have suggested gas pumps would be the problem. There were a lot of legacy gas pumps without chip capability, but at least around here they seem to hvae disappeared one by one over the last couple of years to the point where I don't recall seeing one in a while.

The liability shift (April of this year) for gas pumps was delayed a few years after the liability shift everywhere else (October 2017), which is why only recently pumps have found the chip religion.

Liability shift == card brands are saying that retailers are now liable for all fraudulent transactions committed when it's on a mag stripe (mag stripe as a backup is "OK" if chip is attempted first).

 

[Paul_Johnson]

All of my NFC cards the NFC function dies within about a month.

 

[Brian_B]

All of my NFC cards the NFC function dies within about a month.

I've never used NFC on the card, always my phone, but I can imagine this occuring.

 

[MadMummy76]

Interesting how peoples habits differ.

Prior to the U.S. implementing hips a few years ago, swiping my card using the magstripe was pretty much the ONLY way I ever paid for anything in brick and mortar stores ever since the mid 90's back when I used cash. (I haven't really regularly used cash since ~1995). How did you pay for things before, I don't know, 2015 or so, whenever we went chip?

Since the implementation of chips, now chips are pretty much the only way I ever pay in B&M. For the sake of security though, I wish they had made the PIN mandatory in the U.S. like it is elsewhere. It seems like a very minor inconvenience for the added security it provides, but here they made it optional, and card issuers fear that people will find it too burdensome and just use a different card if they require a PIN, so they haven't required it, which is a shame.

I'm living in Europe, ever since I've had a bank card (credit cards are rare here, even though I have one now) they had chips. But most small businesses refused to accept cards until well into the 2010s, so you had to have cash. I still carry a small amount just in case, but rarely do I have to use it. Nowadays 99% of my shopping is through the NFC function.

 

[Zarathustra]

I'm living in Europe, ever since I've had a bank card (credit cards are rare here, even though I have one now) they had chips. But most small businesses refused to accept cards until well into the 2010s, so you had to have cash. I still carry a small amount just in case, but rarely do I have to use it. Nowadays 99% of my shopping is through the NFC function.

Interesting. Where in Europe?

I grew up in and lived in Sweden from '83 to '99. That's where I got my first bank card in my teens in the mid 90's, and as soon as I did I only very rarely used cash ever again.

Even the little news stands selling newspapers, candy and drinks near the trams/trains/buses accepted cards as early as the early 90's. They were mag stripes back then.

When I moved back to the U.S. in '99 it felt like I was going backwards in time, with small retailers and even many (most?) fastfood locations being cash only. Card adoption in the U.S. has probably grown since then. Apart from my barber, I haven't encountered a place that didn't take cards in over a decade. Still today the only time I ever use cash is when I go to get my hair cut.

The funny part is when I went back to Sweden for my cousins wedding in 2019 there were actually a ton of businesses that refused to take cash. Apparently only really old people and tourists use cash in Sweden now.

We repeatedly went to restaurants that had signs like the below in their windows:

We were getting dinner in a bar in Stockholm one night when a girl came in. She looked really embarrassed and sheepishly walked up to the bartender and asked: "Uh, do you... do you take cash?"

Turns out her grandmother had given her some cash, and she was really embarrassed to have to use it. (No idea why she didn't just deposit it, but...)

 

[Zarathustra]

I've never used NFC on the card, always my phone, but I can imagine this occuring.

Making payments through a phone that only gets very infrequent security updates (most of them) makes me nervous. I've never used any of the phone payment apps for that reason.

 

[Paul_Johnson]

Interesting. Where in Europe?

I grew up in and lived in Sweden from '83 to '99. That's where I got my first bank card in my teens in the mid 90's, and as soon as I did I only very rarely used cash ever again.

Even the little news stands selling newspapers, candy and drinks near the trams/trains/buses accepted cards as early as the early 90's. They were mag stripes back then.

When I moved back to the U.S. in '99 it felt like I was going backwards in time, with small retailers and even many (most?) fastfood locations being cash only. Card adoption in the U.S. has probably grown since then. Apart from my barber, I haven't encountered a place that didn't take cards in over a decade. Still today the only time I ever use cash is when I go to get my hair cut.

The funny part is when I went back to Sweden for my cousins wedding in 2019 there were actually a ton of businesses that refused to take cash. Apparently only really old people and tourists use cash in Sweden now.

We repeatedly went to restaurants that had signs like the below in their windows:

View attachment 1216

We were getting dinner in a bar in Stockholm one night when a girl came in. She looked really embarrassed and sheepishly walked up to the bartender and asked: "Uh, do you... do you take cash?"

Turns out her grandmother had given her some cash, and she was really embarrassed to have to use it. (No idea why she didn't just deposit it, but...)

Cards overtook cash in my experience in The Netherlands by about '02. Credit transactions required PIN's even then.

 

[MadMummy76]

Interesting. Where in Europe?

Former Eastern Bloc. I only got a card after I took my first full time job in 2005. Back then only the largest chains accepted cards.

I preferred card payments as I hated having to fiddle with coins. If you start counting them at the cashier people get angry behind you, so I always ended up paying in larger notes, which meant my wallet was full of coins all the time that I could hardly get rid of. I usually ended up spending the coins in the coke machine in our office building, but even that was a hassle, the machine regularly rejected coins for no apparent reason.

As far as I'm concerned cash can't die fast enough. Nowadays the only places that are still cash based are the ones who let's say are forgetting to report all their revenue.

Now the last bastion of this foolishness are business trips as my company is too cheap to give me a company card, so I'm forced to pay with cash in all hotels and so on. Unless I'm willing to loose the conversion fee by paying with my own card. It's a bit embarrassing sometimes.

 

[Zarathustra]

I preferred card payments as I hated having to fiddle with coins. If you start counting them at the cashier people get angry behind you, so I always ended up paying in larger notes, which meant my wallet was full of coins all the time that I could hardly get rid of. I usually ended up spending the coins in the coke machine in our office building, but even that was a hassle, the machine regularly rejected coins for no apparent reason.

Ha! I remember being annoyed at coins for the same reason!

 

[Brian_B]

Before I went into the service - '97ish... I was mostly cash. If it wasn't cash, it was a check. I didn't have a credit card, and debit cards might have existed, but I didn't have one.

Once I got into the service and started deploying - cash was useless on the ship. You hit a port, and the line at the ATM would be a mile long - it would usually be out of cash before you could get at it. By then, I was able to get a credit card, and got used to it. We never hit foreign ports, so I never had to deal with anything but USD, but it was nice if you, say, forgot to make a phone payment before a 90 day deployment - you could make a call and just get it done over the phone. Or setting up rent and utilities on auto-pay, etc.

Once I got out of the service - I would still carry cash, but pretty much just used it for dining and convenience stores. I found it was a good way to monitor how much I was eating out - once I ran out of cash, no more McD's. I did that... all the way up through COVID hitting. I was single most of that time, so it wasn't like there was a lot of shopping apart from that really.

I also abhored coins. I would always drop my spare change into a bucket at my front door, but never took any back out with me. It ended up adding up to a lot of coins - after 15+ years I cashed it out for an engagement ring, and it bought a decent sized rock

Once COVID hit - not because I was scared of COVID, but mostly because all the restaurants and such just shut down. I stopped carrying cash. I did start using Apple Pay - mostly at gas stations and convenience stores - it started out as a "I'll just try it out" thing. My wallet now just consists of my driver's license, my company card, and my personal card. I don't even carry my debit or any other cards around - but debit is what I use primarily via Apple Pay. Maybe it's just the area we are in, but the chip readers almost never work - no matter what card I try. I've just learned to accept that almost every single store, unless it has Apple Pay, it going to make me stick the chip in 3 times, then let me finally swipe, while everyone in line behind me gives me the stare.

Odd how things shift around.