Wednesday, May 22, 2024

Is This the End of Plastic? Visa’s New Technology Could Replace Physical Cards

Must read


Andriy Onufriyenko / Getty Images

The days of shuffling through your credit cards could be at an end. You’ll soon be able to store your payment methods — credit cards, debit cards, bank accounts — all in one place, potentially rendering physical cards and even credit card numbers obsolete, according to credit card giant Visa.

It’s part of the credit card processor’s plans to use generative AI to change the landscape of payments. After all, when was the last time you swiped or inserted your credit or debit card to make a payment? Tap-to-pay reached 65% global adoption rates at the end of 2023, according to Visa.

“The industry is at a pivotal point — new technologies like Gen AI are rapidly shifting how we shop and manage our finances,” Jack Forestell, chief product and strategy officer at Visa said in a press release.

In addition to bolstering its tap-to-pay capabilities, Visa announced Wednesday a suite of new payment technologies that look to change how you make payments across your accounts, including where and how you use your cards.

Within a decade, you’ll likely access all of your cards with one credential and choose which payment method you’d like to use. That includes not just credit and debit cards, but also Buy Now, Pay Later options and direct payments from your bank account.

For now at least, Visa Flexible Credential only pulls from different accounts within the same institution, so you’d be limited to cards within the Visa network.

The service is currently available in Asia, with plans to roll out to the US this summer.

Biometric protections for your payments

With Visa Payment Passkey, Visa is looking to combat digital fraud and prevent bad actors from making unauthorized payments with your card.

According to the payment-processing giant, fraud occurs seven times more often digitally than it does during in-person transactions. With Passkey, you can use your unique biometrics — your face or fingerprint — to confirm online transactions and prevent unauthorized payments.

You’ll go through online checkout as usual and add your card information. Then an additional screen will pop up to verify your identity with either a face or fingerprint scan.It’s currently piloting in the EU now, with plans to hit North America beginning in the third quarter of 2024.

“[Biometric confirmation is] a lot harder to compromise,” said James Mirfin, SVP, global head of risk and identity solutions at Visa.

Expansions to Tap-to-Pay technology

Visa is also expanding its tap-to-pay capabilities. The days of taking a photo of your card to add to your digital wallet are gone. Instead, Visa is rolling out technology that will allow you to tap your card on your smart device to add it to your wallet. You’ll also be able to tap your card to your phone to confirm a transaction without needing to input any additional information. 

How to protect your information

While the new technology could potentially help protect you from bad actors, there are ways you can help protect yourself now from fraud:

  • Use a virtual card number. A virtual credit card number generates a unique card number to use online. It prevents a merchant from storing your credit card information, helping keep your financial data more secure.
  • Don’t give out your personal information. Even if you agree to receive texts from your bank or credit card, they’ll never ask for personal or confidential information via text messages. 
  • Consider using an identity theft protection and monitoring service. The best services monitor your personal data for signs of fraud and identity theft. Many also flag suspicious credit and bank activity.
  • Sign up for a free credit monitoring service. Some of them will monitor the dark web for your personal identifying information like your Social Security number and email.

The bottom line

Visa is pushing the digital payment space into the next stage while also expanding the popular tap-to-pay capabilities of its cards. Its work with AI fraud detection aims to add extra layers of security for online transactions.

 

But whether these new products will become standard across the board remains to be seen. For them to truly become commonplace, it’ll take the adoption of these new methods by the banks that issue cards and the merchants that accept them. 

 

Other card networks — American Express, Discover and Mastercard — would also need to allow their products to be added to Visa’s Flexible Credentials for it to truly be a one-stop shop for all of your card and payment information.

The editorial content on this page is based solely on objective, independent assessments by our writers and is not influenced by advertising or partnerships. It has not been provided or commissioned by any third party. However, we may receive compensation when you click on links to products or services offered by our partners.

Latest article