Payments processing network Mastercard announced that it will begin phasing out magnetic stripes on its cards within the next three years.
The company said the decision was motivated by a decline in magstripe payments.
“Newly-issued Mastercard credit and debit cards will not be required to have a stripe starting in 2024 in most markets,” Mastercard said.
“By 2033, no Mastercard credit and debit cards will have magnetic stripes, which leaves a long runway for the remaining partners who still rely on the technology to phase in chip card processing.”
Mastercard said that newer and more secure technologies — like embedded chips and NFC contactless antennas — mean that most people are now either inserting their cards or tapping to pay.
It added that biometric cards, which combine fingerprints with chips to verify a cardholder’s identity, offered another layer of security.
The company said it would be the first payments network to drop magnetic stripes.
Mastercard’s view of consumer habits correlates with the experience of major banks in South Africa, which recently told MyBroadband they don’t anticipate a lack of magnetic stripe support as a problem for shoppers.
Most banks’ point-of-sale (POS) devices can read chips, and the vast majority of their payment terminals are enabled for contactless payments.
Absa’s head of commercial payments and relationship banking Enoch Malisa said that magnetic stripe transactions in South Africa were rare.
“While all POS devices in the industry still cater for magnetic strip and chip payments, magnetic strip transactions are not that common anymore,” Malisa stated.
“The introduction of NFC on POS devices over the past seven to ten years has been driven by the introduction of contactless cards that are NFC-enabled,” he added.