Dynamics, Inc, a Pittsburgh-based company is making it easier to pay with plastic.  Called the 2G (second generation) card, these plastic plates come in the same dimensions as today’s credit cards with a few more bells and whistles.  Outfitted with a 4-year battery, a microchip and a programmable magnetic stripe, these cards promote consumer choice.  While one person may want to tighten up security, another may want flexibility of payment.

Instead of carrying multiple cards, a 2-button interface allows consumers to choose which account they want to use.   In some cases a card could offer both a business and personal account, on another card the consumer may have the option to select between credit and cashing in rewards points – potentially getting their purchases for free at the point of sale.  A small light on the card indicates which option has been selected.  While rewards may be instantaneous, sometimes it pays to wait.  Early indications are that the cash back percentages per purchase may not be as high as on cards that you have to cash in online.

For those interested in enhanced security, they may choose cards with anti-skimming technology which replaces the old three or four digit security code printed on the back of each card by creating a new, unique dynamic code for each purchase.   On some cards, a portion of the account number is hidden until the correct pin is entered.

These theft reduction measures benefits the credit card companies as well.  The Federal Fair Credit Billing act limits consumer liability to $50.  With programmable magnetic stripes, card holders or providers can remotely deactivate cards as soon as they realize they are lost or stolen, thereby limiting the amount of time the provider is exposed to fraudulent charges.

Several card variations have been released on the market in consumer trials since May 2010. Additionally, cards have been robotically swipe tested thousands of times and put through the ringer in several washing machine cycles to make sure they can withstand the daily abuse perpetrated by the average user.  Citibank expects to make them available in November 2010 for select customers, with increasing distribution in 2011.

If you have any questions or would like more information, please contact:

Amy Cozine

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