Recent Developments in Credit Card Technology

Recent Developments in Credit Card Technology

For decades, many have preferred using credit cards to paying with cash for reasons including convenience and practicality. Today, credit cards are even easier for consumers to use and business owners to process due to technological advances in reading card numbers. The introduction and popular use of smartphones, the Internet, and microchips have played roles in the development of new credit card technologies. These technological advances include smartphone credit card readers, virtual credit cards, and RFID chip embedded credit cards.

Smartphone Credit Card Readers

Smartphone credit card readers, which plug into phones, enable business owners and employees to complete customers’ credit card transactions via smartphone apps. These card reading devices, which are made mostly of plastic, are available through a number of payment processors, including PayPal, Square, PayAnywhere, and Intuit.

This form of credit card technology is ideal for traveling businesspeople and home delivery businesses as it provides customers with the option of paying with credit if they do not have cash or checks on hand. A customer need only swipe his or her card through the smartphone reader and provide a signature to complete the transaction. Credit card readers are available for all types of smartphones, including the iPhone, BlackBerry, and Android phones.

One potential drawback of using a smartphone credit card reader for your business is that some customers may be wary of swiping their cards in a device attached to your personal smartphone. The good news is that the legitimate payment processors offering smartphone readers take all of the necessary steps to ensure that data is encrypted and that no personal information is compromised.

Virtual Credit Cards

Virtual credit cards are temporary credit card numbers designed to protect against identity theft during online transactions. Virtual numbers, which are offered by credit card providers such as Discover, Bank of America, and MasterCard, may be valid for one time only use or may be used several times with a single merchant. A temporary number is typically generated through a software program that associates the number with an actual credit card. The use of this virtual number online keeps your personal information safe from potential identity thieves, who cannot trace it back to your card.

Though virtual credit cards are advantageous for people who do not want to provide their actual credit card numbers to online payment processors, they can cause issues for consumers who try to return items after the numbers have expired. In order to avoid such issues, you may want to request a number that will be valid for an extended period of time. Also, you should remember to keep your receipts from virtual credit card purchases on hand so that you will recognize the numbers on your credit card bills and can confirm that you made each purchase.

Credit Cards with RFID Chips

Credit cards with RFID (radio frequency identification) chips are capable of being read by being held in front of readers in addition to being swiped through credit card machines in the usual manner. The chips embedded in these types of cards emit radio waves that can be read by receivers. This way of processing credit card information can help to protect against security hazards and make the transaction process move more quickly and efficiently.

If you carry a credit card with an RFID chip, you’re able to scan your card without removing it from a wallet or purse. The scanners encrypt all of the data that they receive, making it difficult for identity thieves to retrieve personal information. Further, the authentication code on an RFID chip card changes with each scan, offering protection against multiple unauthorized transactions. One downside to RFID chip cards is that they can still function like traditional credit cards, giving thieves the potential to use them by swiping the magnetic strips.

Whether you decide to use a technologically advanced credit card or are more comfortable with a traditional one, you can benefit greatly by learning about ways to stay out of debt. Companies such as National Debt Relief offer a number of online educational resources focused on managing your credit cards and finances.

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