by

Transaction cards have evolved to now increasingly include a variety of electronic elements. Perhaps because of consumer familiarity with fingerprint and face identification features in prevalent smart phone and computer products, it is not surprising to see that more than 60% of cardholders recently surveyed accept the concept of biometrics for identity authentication and more than 75% have used biometrics for their smart phone and/or computer authentication. Adding such capabilities to transaction cards is a natural progression. Building on these developments has been the addition of displays, LED lights, interactive buttons and keyboards to these cards. Complexity of card manufacturing increases with each incremental electronic element.

Biometrics for cardholder authentication have been tested and accepted as stronger authentication than the traditional signature and PIN processes. They are less cumbersome, and more reliable, than strong passwords, multi-factor authentication and single sign-on processes used in other applications although such implementations for transaction cards are not easily incorporated. A huge leap in the use of this technology element occurred when the sensor chip system could be powered from the contactless reader/terminal radio-frequency field; a battery was no longer needed, simplifying the manufacturing process and lowering the card cost. While applications are apparent in both secure payments and ID, eID and physical/logical access control appear to have the upward momentum currently in this technology.

Dynamic security codes for card authentication in “card-not-present” (CNP) transactions are clearly superior to the static security codes “indented” into cards at the time of personalization. While this is a technology solution for the growing CNP fraud, it is still very much a niche application. Its major drawbacks are a proprietary back office “black box” used to synchronize and verify the changing codes and the requirements for a battery on board the card to power the display. Newer technologies are evolving to eliminate the need for a battery and integrating the black box into the traditional back-office systems. Once these are accomplished, standard chip card manufacturing processes can be employed, reducing the card cost and accelerating these technology elements into broader use.

Primary applications for cards with displays have been for combined payment of cash/credit and loyalty “points” used as a payment currency. There have also been some “one-time-password” (OTP) applications whereby a dynamic alpha/numeric password is provided at the time of card use and displayed on the card. Card manufacturing of these cards is complex and outside of traditional card manufacturing processes. Card body construction is typically in several layers, up to 20 layers or more, versus a single inlay layer in a laminated card body. Cold lamination (adhesive) is prevalent versus temperature and pressure lamination common in chip card construction. Production has been relatively low volume and costly, comparatively. True multi-application capability in cards is the vision, much like the applications resident on smartphone products. But battery, electronic component cost and complex card body construction will continue to limit its practical application in the card industry near term.

Cards with lights and LEDs have been around for decades yet are still a niche application. Technology has evolved to battery-free implementations, mainly when used with a contactless card reader, so this technology element has the potential to be used more broadly. Not insignificantly, it has at least, if not more, interest in non-secure card applications as secure cards. It has visual interest for cardholders (wow factor) and can be manufactured with inlays just like contactless chip cards. Production volumes are needed to justify the added cost factor of a custom inlay for the defined card product, however.

The development of advanced technologies applicable to cards is reaching the stage, in many significant areas, where its broader adoption is imminent. Cards with electronic elements that do not need an on-board battery provide distinct advantages in cost, simplicity of manufacturing and well understood production processes. When known and stable card manufacturing processes can be adapted for these elements, confidence in the production volume of these cards helps mitigate field reliability unknowns whenever new elements are introduced.

About the Author: David Tushie, ICMA standards and technical representative, has had a long and continuing career in the card industry, working for international companies such as DataCard, UbiQ and NBS Technologies. He has master’s degrees in engineering and business, holds U.S. and international patents in measurement and card issuance systems and has had several years of involvement with the ANSI, INCITS and ISO Standards process. ICMA is represented at six ISO and ANSI Standards Meetings through David’s standards role within the association.