Credit card fraud and identity theft affect over 20 million people every year, and while credit card technology is advancing to try to fight it, it’s doing so at a painfully slow rate. If a French credit card maker has their way, however, we’ll be using special new cards with batteries and screens.
The credit card prototype is designed by Oberthur Technologies and is designed to last three years. Inside the card is a small battery that powers a mini-ink screen. The screen takes the place of your CVV code and displays a randomly generated set of three digits every 40 to 60 minutes.
This would make it almost impossible for someone to use your credit card data, even if they wrote down all the information on it. As an added benefit, this would likely work for store purchases as well. Every purchase made with your credit card would be done using a temporary password that your bank would verify, so if there were ever to be a data breach like the one Target experienced in 2013, it could still help render some of that information useless.
The problem so far is that changing credit card technology is not an easy or inexpensive task. Already, many credit card companies are trying to make a switch over to new cards embedded with fraud-proof chips, but though they are supposed to finish replacing their cards by 2015, they are falling drastically behind.
Replacing cards also costs billions of dollars, and this new prototype could cost $10-20 per card whereas current magnetic strips can be purchased for only 20 cents. The large increase in cost aside, it will be difficult to sell this product to banks that are still in the middle of a previous upgrade.
Banks also aren’t the only ones who need to spend money on this new technology. The current upgrade featuring fraud-proof chips will require new equipment in stores, as buyers will have to dip their card into a machine rather than swipe it. Purchase and installation costs can run up to hundreds of dollars per machine, which is a steep price for businesses of all sizes.
What could help is criticism of fraud-proof chips that claims they aren’t very effective in preventing fraud. According to CNN Money, the chip-embedded cards are difficult to duplicate, but can still be used if someone has the card’s information. Considering banks often reimburse those affected by fraud, this can get costly very fast. If this new technology proves useful, it could be an investment worth making in the long term.
America is behind many other countries when it comes to credit card security, so though this is only a prototype, it could be the kind of technology we need to catch up.
[Photo by Jeff J Mitchell/Getty Images]