MasterCard Worldwide recently introduced a chip-embedded card in Taiwan that functions as both a regular credit card and an authenticator for online banking money transfers.
The SinoPac Display Card functions the same way a normal credit card does, except a chip embedded in the upper right hand corner generates one-time-use authentication passwords. The card contains a button to push to generate the six-digit display.
Online banking customers who use the card will enter their account credentials to execute transfers, but once that information is validated, consumers will be prompted to also enter their one-time passcode. Then, consumers will push the display card button to generate a new, six-digit number and subsequently enter that to finalize the transaction.
The bank's back-end network is able to validate a consumer's entry because it knows what number a specific card will generate within a given period, according to Randy Vanderhoof, Executive Director of the Smart Card Alliance.
"This is addressing the risk of people having their accounts taken over and funds being moved out without their approval," Vanderhoof said.
"It's a much higher level of security because the password's only good for a limited amount of time, and the user has to have possession of the card along with other credentials at the same time."
Bank of America Corp. unveiled a product last year, called SafePass, which also uses a card-embedded, chip-generated password to authenticate online banking activity. But SafePass is a standalone product, while SinoPac Display Card functions as both an online banking authenticator and a credit card.
Additionally, MasterCard said its card display service is faster than authentication services that send text messages to users' mobile phones to verify money transfers and other transactions.
Vanderhoof said some companies are considering the use of digital chips on prepaid cards as a way to show a user's real-time balance by generating a new number with each purchase or add-on.
He also said the technology might eventually be used with a PIN code that consumers would enter to unlock a card for purchasing, although that would require that a small keypad be embedded in the card along with the digital reader.
"This is just another way of using chip technology to build additional security functionality in the payment card," Vanderhoof said. "This along with EMV along with contactless are all steps in, how do you make that payment vehicle and that identity card more secure? All of it is helping move the industry off the dumb, mag stripe, flat form to something that's more secure, more intelligent and offers more services," he said.
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