New credit card technologies offer biometrics, universality

Two new credit card technologies will soon be presented at retailers' point-of-sale systems. One offers more secure biometric activation, and the other combines all of a consumer's cards into one.

SmartMetric is about to release its new biometric-activated and user-validated EMV payments card in the United States and the European Union. The company expects Asia to follow.

The SmartMetric card is self-powered by a rechargeable battery and has a fingerprint reader inside that reads a user's fingerprint to activate the card's EMV chip prior to a transaction.

"We are extremely excited about the incredible prospects for the company with our biometric secure EMV chip payments card product and are prepared to capitalize on the substantial existing global market of over 3.4 billion issued EMV chip cards in use around the world," said SmartMetric's President & CEO Chaya Hendrick in a company statement.

SmartMetric said it has received interest from financial institutions that want to use technology to reduce card fraud and provide an extra layer of protection against identity theft, reported.

The research and development for the SmartMetric card has been in the works for years, but the company said the biggest hurdle was the "physical size of components" of the card.

"What we have done is scale down components such as our Cortex processor and memory along with the power management system to a thickness less than a third the height of a standard credit card. This in itself is a phenomenal achievement in the field of electronics," Hendrick said.

Stratos is now offering a universal credit card that consolidates all of a consumers' credit cards into one piece of sophisticated plastic. To use a specific card, the shopper taps a hidden button or selects one on a mobile app, TechCrunch reported. However, early tests indicated that the card did not work about 5 percent of the time, thus necessitating that consumers carry other cards rather than leaving them home, negating the main benefit of the card.

Stratos is similar to an earlier universal credit card, Coin, but is said to be more advanced. Plastc and Swyp are two others attempting to compete for this business. By tapping the Stratos card, lights flash next to hidden buttons that are used to select the payment account. While Stratos can only hold three credit cards, its app can hold an unlimited number that can be swapped onto the physical card. It can also be used for loyalty cards. It costs $95 a year with free annual card upgrades, and a chip-and-pin version is being developed. The company, along with competitor Coin, are working to make the cards EMV-ready. The current card has two magnetic strips to allow it to be used in more types of card readers.

If EMV readiness is not addressed, that could be a major challenge for Stratos, Forrester analyst Sucharita Mulpuru told CNET. "If you have a chip in your card, the POS system is going to prompt you to put your card in the [chip] slot," Mulpuru said. That will become a problem with chip-less cards like the one offered by Stratos. As a result, consumers will still need to carry a backup card.

EMV is more difficult to replicate than a magnetic stripe, and Stratos and its competitors have struggled to incorporate the technology into their early products. Coin does not have EMV capabilities, while Plastc and Swyp are expected to be launched later this year with EMV compliance. Plastc will include an EMV chip in its universal card while Swyp says it will provide an "over the air firmware upgrade."

However, because the U.S. EMV system will still allow for magnetic strip swipes, cards like Stratos will be functional at the POS. Also, these cards don't store unencrypted credit or debit card information relying on the shopper's smartphone to transmit data. That makes the cards more secure, CNET said.

For more:
-See this SmartMetric press release
-See this article
-See this TechCrunch article
-See this CNET article
-See this CNN Money article

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