The days of shuffling through your credit cards could be at an end. You’ll soon be able to store your payment methods -- credit cards, debit cards, bank accounts -- all in one place, potentially rendering physical cards and even credit card numbers obsolete, according to credit card giant Visa.
It’s part of the credit card processor’s plans to use generative AI to change the landscape of payments. After all, when was the last time you swiped or inserted your credit or debit card to make a payment? Tap-to-pay reached 65% global adoption rates at the end of 2023, according to Visa.
“The industry is at a pivotal point -- new technologies like Gen AI are rapidly shifting how we shop and manage our finances,” Jack Forestell, chief product and strategy officer at Visa, said in a press release.
In addition to bolstering its tap-to-pay capabilities, Visa announced Wednesday a suite of new payment technologies that look to change how you make payments across your accounts, including where and how you use your cards.
Within a decade, you’ll likely access all of your cards with one credential and choose which payment method you’d like to use. That includes not just credit and debit cards, but also buy now, pay later options and direct payments from your bank account.
Could this be the first step toward physical credit cards going away?
“That would seem to be the logical trajectory,” said John Ulzheimer, a credit expert formerly of FICO, Equifax and Credit.com. “There are already fully digitized driver’s licenses and digitized credit cards -- Apple Card and ApplePay [for example] -- so why not go fully digital across the board?”
However, some credit card experts express wariness with this new tech.
“I’m very skeptical that this will work out well for consumers or merchants,” said CNET Money Expert Review Board member Jason Steele. “There are just too many online and telephone interactions that rely on consumers providing card numbers to merchants. Most consumers find themselves providing card numbers to complete transactions several times a week.”
Visa’s service is currently available in Asia, with plans to roll out to the US this summer.
Biometric protections for your payments
With Visa Payment Passkey, Visa is looking to combat digital fraud and prevent bad actors from making unauthorized payments with your card.
According to the payment-processing giant, fraud occurs seven times more often digitally than it does during in-person transactions. With Passkey, you can use your unique biometrics -- your face or fingerprint -- to confirm online transactions and prevent unauthorized payments.
You’ll go through online checkout as usual and add your card information. Then an additional screen will pop up to verify your identity with either a face or fingerprint scan. It’s being piloted in the European Union now, with plans to hit North America beginning in the third quarter of 2024.
“[Biometric confirmation is] a lot harder to compromise,” said James Mirfin, SVP, global head of risk and identity solutions at Visa.
However, adoption of this technology could vary from person to person.
“There will always be people who are uncomfortable using biometric anything, including face recognition, voice recognition, retinal scan tech and fingerprint tech,” Ulzheimer said. “I can see there still being a two-step authentication needed until a full biometric authentication process is deemed to be AI-fraud proof.”
Gen AI could be a big concern when it comes to using biometrics to confirm a purchase, said credit expert and CNET Expert Review Board member Gerri Detweiler.
“There are serious and valid concerns with voice recognition and face recognition technologies in banking and payment technology,” she said. “However, when we are talking about credit cards, issuers and merchants bear a lot of the risk, since consumers have strong fraud protection under federal law.”
Expansions to tap-to-pay technology
Visa is also expanding its tap-to-pay capabilities. The days of taking a photo of your card to add to your digital wallet are gone. Instead, Visa is rolling out technology that will allow you to tap your card on your smart device to add it to your wallet. You’ll also be able to tap your card to your phone to confirm a transaction without needing to input any additional information.
With physical card numbers becoming less important and borderline riskier compared to using a virtual credit card number for your online shopping, it stands to reason cards could soon be shipped without physical numbers printed on the card itself.
“I don’t expect the transition to numberless cards will happen that quickly,” Detweiler said. “There are still plenty of cardholders who want a physical card with a number, or who will need that information for certain types of purchases. But we’re moving in that direction, and these changes are where that starts.”
How to protect your information
While the new technology could potentially help protect you from bad actors, there are ways you can help protect yourself from fraud right now:
- Use a virtual card number. A virtual credit card number generates a unique card number to use online. It prevents a merchant from storing your credit card information, helping keep your financial data more secure.
- Don’t give out your personal information. Even if you agree to receive texts from your bank or credit card, they’ll never ask for personal or confidential information via text messages.
- Consider using an identity theft protection and monitoring service. The best services monitor your personal data for signs of fraud and identity theft. Many also flag suspicious credit and bank activity.
- Sign up for a free credit monitoring service. Some of them will monitor the dark web for your personal identifying information like your Social Security number and email.
The bottom line
Visa is pushing the digital payment space into the next stage while also expanding the popular tap-to-pay capabilities of its cards. Its work with AI fraud detection aims to add extra layers of security for online transactions.
But whether these new products will become standard across the board remains to be seen. For them to truly become commonplace, it’ll take the adoption of these new methods by the banks that issue cards and the merchants that accept them.
“There’s a constant race for innovation among payment networks, brands and issuers,” Detweiler said. “The way many of us make payments will look different in a year or five years from now.”
Other card networks -- American Express, Discover and Mastercard -- would also need to allow their products to be added to Visa’s Flexible Credentials for it to truly be a one-stop shop for all of your card and payment information.
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