Saving + Shopping

Credit cards get a safety makeover


Credit card safety makeover

What do Home Depot, Target and TJ Maxx have in common? They’ve all suffered recent, massive credit card breaches, exposing your personal information. Not cool.

In 2013 alone, an unprecedented 740 million-plus records were compromised, according to the California-based Privacy Rights Clearinghouse—and the list is rapidly growing, as major retailers can’t seem to stop hackers from getting to shoppers’ personal data. And if you want to get a severe headache, you can read this white paper, which outlines all the security breaches (that we know about) that happened in 2014.

The switch to PIN and chip readers (the long-time norm in other countries) is on the horizon, a change that will undoubtedly make using your plastic safer. But in the meantime, smaller startups have been hatching some innovative solutions (though not without some sizable hurdles and setbacks), each intended to make commerce feel a bit more secure.

Stratos Card

Stratos

Stratos is a “smart”, durable, waterproof card that you can load with information from your existing plastic cards— credit, debit, loyalty, membership, gift cards… anything with a stripe that you’d swipe. Then, just tap Stratos to locate the card you want, and use it like you would any other credit card. It’s safer than the plastic you carry now, because it uses bank-level encryption and never actually displays your card numbers. And you can set your Stratos Card to lock down if it’s lost or stolen.  Stratos itself only holds 3 cards at once, but the app holds the rest of your information, so you can swap out cards as you need them.

Coin Card

Coin

Coin operates like Stratos does, wanting to replace all your credit, debit, membership and loyalty cards with one WiFi-enabled card that can be swiped just like the regular plastic variety. Just press a button on Coin to select the card you want. And it’s tethered to your smartphone: If you accidentally leave your Coin behind, it will auto-lock against thieves, and text you to let you know you forgot it. If an unauthorized user attempts to access your Coin, after three tries— BOOM, it will be erased.

Apple Pay

Apple Pay

What it does for you: Apple wants you leave your plastic at home and pay with your phone (or your Apple Watch, coming soon to your wrist). Apple Pay allows you to hold your phone near a reader, authorize it with a fingerprint touch, and instantly transmit payment information. Because you never hand over a card to a merchant with Apple Pay, your card numbers are never revealed. Instead, all your data is encrypted, and transmitted by NFC (Near Field Communication). Plus, if your phone is ever lost, you can use Find My iPhone to lock it, or remotely wipe its information.

Card Control

Card Control by OnDot

If you’ve ever wished you could render a plastic credit card “locked” or “active” at will, to keep it safe from hackers while not in use, you’ve dreamed up this technology. Card Control turns your phone into a remote control for your credit cards, letting you switch them on and off, or make them unusable if they aren’t within a certain radius of your phone (why, in 2014, my credit card company doesn’t reliably flag charges that are made in stores and states I’ve never been to is beyond me). You can also set spending limits, or disallow certain types of purchases, which is great for college kids or anyone you want to keep on a short leash (including yourself).

Wallaby

Wallaby

Wallaby connects all your credit cards to one “smart” plastic card; when you swipe it, Wallaby determines which of your cards would be the best one to use, maximizing your rewards for each purchase. You don’t have to do the thinking, or even bring all those cards with you, to earn those triple points or that cash back. Though this system isn’t designed to improve security per se, because you’re swiping one card instead of many, and can leave your plastic at home, your personal information isn’t at as much risk of exposure. Like all these contenders, they use bank-level security, and its application is “read-only” (which means it can’t manipulate your accounts, nor can anyone else who happens to log into your account).

Although no system is ironclad, new technology may eventually help to stack the (credit card) deck in your favor. And often, the more nimble, ambitious upstarts push the larger companies toward bigger changes faster, which benefits us all.



5 comments on “Credit cards get a safety makeover”

  1. Love getting your updates so I know the latest when it comes to my credit cards, risks I’m taking, etc. Thanks Carley!

    1. Hi Kamy! So many of these are so early to market, it’s tough to know which will survive and be best of class. I have been using Apple Pay these last few months and really like how simple it is, and that, sometimes, I don’t have to take my wallet with me. Stratos will be sending me a test unit soon, and I can’t wait to try it out. And Coin looks similar, but it’s not available yet. Might be too soon to tell, but any system that doesn’t show my card number to the retailer (or any other prying eyes), is progress, I think.

  2. Hey Carly – this is a great article. Have to reread it in the morning when I can really take it in, but it’s fascinating. Always look forward to your latest.

    Colleen

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