Mastercard will do away with magnetic stripes on its cards from 2024

Mastercard will phase out the use of magnetic strips on its credit and debit cards over the next decade as the industry moves to safer and more convenient alternatives such as chips and contactless payments, the company announced. The company says it will be the first payment network to phase out the technology, which dates back to the 1960s.

Mastercard says the transition will begin in 2024, when the strip will no longer be required on new cards in regions such as Europe, where chip cards are already widely used. In the U.S., where adoption of chip payments has been slower, the transition will begin in 2027. Starting in 2029, no new Mastercard debit or credit card will have a magnetic stripe, and by 2033 it will disappear entirely.

Magnetic strips were a huge improvement over the flatbed typewriters (aka "knuckles") that cashiers used to record card data. But in the 1990s, the global EMV chip standard was introduced, paving the way for more secure storage of cardholder data on small integrated circuit chips embedded in cards. Currently, 86 percent of personal card transactions worldwide are done using EMV chips.

While chip cards are positioned as the successor to magnetic strips, Mastercard notes that contactless payments, which can be made both with the card and digitally via most modern smartphones, have grown dramatically in popularity during the pandemic. The number of contactless transactions increased by 1 billion in the first quarter of this year compared to last year, the report said. Globally, 45% of in-person transactions were contactless in the second quarter of this year.

Source: mastercard