Major Changes to Credit and Debit Cards in the US: What You Need to Know
In a move that will revolutionize the way Americans make payments, Visa has announced significant changes to how credit and debit cards will operate in the United States. These changes, set to roll out in the coming months and years, will have a profound impact on the physical cards we carry in our wallets and render the traditional 16-digit card numbers increasingly irrelevant.
One of the most significant changes is the introduction of one physical payment card that will be connected to multiple bank accounts. This means that consumers will no longer need to carry multiple cards from different banks. Instead, they will be able to set criteria with their bank, such as specific purchase limits or preferences for certain merchants, and have those applied to their debit or credit card accordingly. This feature, already popular in Asia, will be available to Americans this summer, with buy now, pay later company Affirm being the first to roll out the feature in the United States.
These changes come at a time when Americans have a plethora of payment options beyond just credit or debit cards. From buy now, pay later companies to peer-to-peer payment platforms and digital payment systems like Apple Pay, consumers now have more choices than ever before. Mark Nelsen, Visa’s global head of consumer payments, believes that these new features will bring us to a point where consumers may never need to manually enter an account number again.
Visa’s decision to implement these changes is not only driven by the desire to provide consumers with more convenience and flexibility but also by the need to address the growing problem of online payment fraud. With more countries embracing digital payments, online fraud has become a prevalent issue. Visa estimates that payment fraud occurs seven times more frequently online than in person, and there are now billions of stolen credit and debit card numbers available to criminals. By introducing these new features, Visa aims to enhance security and protect consumers against fraud.
Moreover, these changes are also a response to the innovative features introduced by non-payment companies in recent years. For instance, the Apple Card, which uses Mastercard as its payment network, does not come with a printed 16-digit account number. Apple Card users can request a fresh credit card number at any time without having to dispose of the physical card. Visa executives envision a future where the 16-digit account number, if present on new cards, becomes largely symbolic.
In addition to the consolidation of bank accounts onto one physical card, Visa is also introducing changes to tap-to-pay features. Americans will soon be able to add their credit or debit cards to mobile wallets by simply tapping them to their smartphones, eliminating the need to scan the card’s information or manually enter it. Furthermore, Visa plans to implement biometrics for transaction approval, similar to Apple’s fingerprint or face scan feature. These advancements in technology will not only streamline the payment process but also enhance security and protect consumers from unauthorized transactions.
While these features will take time to be adopted by banks and credit card companies, Visa’s customers, it is clear that financial institutions have been keenly interested in these developments. The implementation of these features will ultimately be decided by the banks, and they will have the flexibility to choose which features to offer their customers.
In conclusion, the changes Visa is introducing to credit and debit cards in the United States mark a significant shift in how payments operate. By consolidating multiple bank accounts onto one physical card and introducing tap-to-pay and biometric features, Visa aims to provide consumers with greater convenience, enhanced security, and protection against fraud. As the payment landscape continues to evolve, these changes will undoubtedly shape the future of payments in America.
