If you look in your wallet right now, you will probably see a few credit or debit cards which have magnetic stripes on the back. These are currently the most commonly accepted way to pay for things in the US, but soon this will no longer be the case. Much like the VCR you have sitting in your basement that can’t be used for new movies, the magnetic stripe cards will soon be a thing of the past. Many consumers in America are unaware that this technology which they use daily to protect their account and payment information while doing their daily shopping is actually quite out of date. In fact, currently the US is one of only 3 or 4 other countries in the world still using this method, and some of these others include Mongolia and a few areas in the Middle East. It may be late compared to many other countries around the world, but a change is very near on the horizon which will put a computer chip in your card rather than a magnetic stripe. Within the next 5 years, you may be making purchases in a much safer and more modern fashion.
How Does it Work?
Americans who have often traveled overseas in the past decade or more have probably already seen smartcard technology in action, and even used it themselves. The magnetic strip in a credit card is replaced by a much more secure computer chip, which communicates with special reading technology which will need to be put in place at every retailer that wants to accept card payments. The reader will verify the information on the chip, and it is much more difficult to commit fraud with this high security method in place. Of course, you will still need to be careful when shopping online, as you will putting your payment information in manually. Unless you begin to use fingerprint scanning devices to make secure purchases online. This new computer chip process will be much faster and safer than the current strip, and will bring the US into the modern age of purchasing.
What will be Different?
There isn’t much that will change for you when you begin to use these smart credit cards. You will still scan them at checkout and input a PIN, but it will be much more secure. When your bank decides to switch you over, it will most likely be at their expense. New cards are usually sent out by mail, though if you need more information about using smartcards you can contact the local branch. It shouldn’t require any extra technical expertise to use these cards, but educating yourself about the security and process is still a good idea. Now you will have computer technology even in your wallet or purse.
When will the Switch Take Place?
Many major card companies planned to have the switch from strips to chips on cards made less than two years from now, in late 2016. This outlook may be a bit optimistic, as many companies are already behind on the original schedule. Not only do the cards need to be changed, the stores need to put the new smartcard readers in place as well. This will be an expensive change to make for some retailers. You can safely predict that it will happen within the next five years.