Today, it is very common to pay for Contactless payment by using a debit or credit card, not to mention that more and more people pay for NFC from their smartphone or smart watch. To further enhanced the security, Mastercard has announced that from 2024, it begins to phase out the use of magnetic stripes on its credit and debit cards, a very old technology that was invented in the 60s.
According to Mastercard, the transition will start in 2024, when the band is no longer needed on new cards in regions like Europe, where chip cards are already widely used. However, in the United States, the adoption of chip payments has been slower, the transition will begin in 2027. Starting in 2029, the new debit or credit cards from Mastercard will not have magnetic stripe and expected to disappear completely out of the market by 2033.
Although chip cards are positioned as successors to magnetic stripes, Mastercard notes that contactless payments, which can be made both with a card and digitally using most modern smartphones, have exploded in popularity during the pandemic.
The number of contactless transactions has increased by 1 billion in the first quarter of this year compared to last year. Worldwide, 45% of checkout transactions in the second quarter of the year were contactless.