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Beyond the Transaction: Every Transaction Has a Story

Safety in Choice: The Computerized Card

My sister and I were recently trying to convey to our parents that we aren’t fools for not balancing our checkbooks (first of all, our what?) – that with online banking we can actually see our transactions, and monitor the ebb and flow of funds. We can check our accounts whenever we want (or compulsively, several times a day).

But now, online banking will be just one of several options as MasterCard and Dynamics Inc. bring us new interactive payment cards.

To find out more about what they can do, we chatted with MasterCard’s Pete Kaulbach.

Nicole Ward (NW): Thanks for talking to us, this is really exciting. This card is being called a computer in my wallet. What can it do?

Pete Kaulbach (PK): “This is huge. These next generation payment cards have a circuit board embedded within them, which means consumers will be able to interact with their cards like never before. And you’re probably thinking, ‘what do you mean, I can interact with my card?’ It means that if you’re traveling, with the touch of a button, you can transact in the local currency. It means wherever you are, you have access to multiple payment accounts and even turn your card on and off for security purposes.”

NW: You just mentioned the ability to turn the card on and off, pretty amazing. Talk to me about the other security measures.

PK: “The Dynamics MasterCard cards allow for multiple layers of security. First let me explain a little bit more about turning the card of and off, because it really is something we’re proud of. Unlike cards today, our hidden card shows only half of the standard 16 digit card number. And when the card is off, the numbers don’t show. To turn it on – enter a secret code directly onto the card. No code? No card. It can’t be used unless the correct code is entered. So if your card is lost or stolen, you don’t have to worry about a bunch of unauthorized purchases.

But like I said, there are safety layers, so let me talk about a couple of others … This can get a little techy, so let me try to boil it down. This card has a dynamic mag-stripe with a high-tech card verification code (CVC) for purchases made online or in physical stores. If, for example, a fraudster steals the information on the mag-stripe, in order to make a counterfeit card, the CVC1, will have already expired. It can only be generated on the card itself. So the stolen mag-stripe information is useless without the card.

In addition,  we have a solution for when the card is not there for the merchant to verify, like in online or phone transactions. Normally cards, have a static three digit CVC2 code,on the back of the card. Our cards, however, will carry a dynamic CVC2 that is shown in display on the back of the card. This dynamic code is generated by the card itself, and again, if stolen, will be useless to a fraudster.  These security features are possible because of EMV in the cards, which is now required in the US.”

NW: Digital payments are big and growing all the time. Why is it important to invest in innovation of the plastic card, in a world that’s paying with phones and watches?

PK: “Innovation is happening all the time and this is largely being led by consumer demand. Nobody gets up in the morning and thinks, ‘I have to pay for transportation to the office,’ or, ‘How am I going to pay for the groceries I buy?’ How people pay for things needs to be seamless, convenient and ubiquitous. Innovating on the plastic card helps MasterCard provide a better experience for consumers who want to continue to use that method of payment, while others embrace mobile. We like to think we have a solution for every consumer.”

For more on what these next gen cards mean for consumers, watch this short video of Carlos Menendez, group executive, Global Consumer Products.