'Smart' credit cards get closer to consumers' wallets

Customers of a company called Dynamics are preparing to release credit and debit cards with programmable, rewritable magnetic stripes.

Tech Industry
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SANTA CLARA, Calif.--I've been seeing demos of credit cards with rewritable magnetic stripes since I started covering start-ups in 1998, but it appears that Dynamics is going to be the first company to actually get this technology into the hands of consumers. At Demo Fall 2010, I saw a quick (and, to be clear, incomplete) demo of two kinds of credit cards that can have their magnetic stripes rewritten on the fly.

First, CEO Jeffrey Mullen showed a two-accounts-in-one card. The user could press a button to switch the card from one account to another. Second, he showed a security-enabled card that kept both the mag stripe and the human-readable number on the front of the card obscured until a security code was entered in. Both, obviously, are an improvement from the cards we carry now in our wallets.

Mullen says these cards are as thin and durable as existing dumb cards, down to their capability to survive trips through washing machines. He also says that financial institutions, which he won't name, have these cards in the field for testing right now, and that we'll see the technology appear in consumers' hands shortly.

These electronic cards are more expensive to produce than existing cards, but the user value or increased security of the cards easily offsets the cost. And, of course, the fact that the cards can be used in existing, ancient mag-stripe card readers means there's no merchant or bank barrier to their acceptance.