Magnetic stripe card

Magnetic stripe card
Name	Magnetic stripe card
Invented	1960s
Inventor	IBM, Forrest Parry
Type	Card

Magnetic stripe card A magnetic stripe card is a portable plastic card with a magnetic stripe that stores data for identification, financial transactions, and access control. It underpins many Automated Teller Machine networks, credit card systems, and mass transit fare collection schemes, and interfaces with point-of-sale terminals, card readers, and legacy payment infrastructures.

Overview

Magnetic stripe cards combine a polymer substrate with a magnetically coated stripe encoded to represent account numbers, expiration dates, and discretionary data used by systems operated by Visa, Mastercard, American Express, Diners Club International, and Discover Financial Services. The cards are read by swiping through or inserting into a magnetic read head in devices from vendors such as NCR Corporation, Diebold Nixdorf, Verifone, and Ingenico. Standards bodies including the International Organization for Standardization (ISO), International Electrotechnical Commission (IEC), and industry consortia such as the Europay–Mastercard–Visa (EMV) working groups have driven interoperability with financial networks like SWIFT and regional schemes such as Octopus card planners.

History

Magnetic recording on media evolved from work by Guglielmo Marconi-era researchers and later magnetic tape pioneers like Valdemar Poulsen and companies including IBM and American Express. In the 1960s, engineers such as Forrest Parry at IBM developed practical magnetic stripe implementations for banking and transportation use. Deployment expanded during the 1970s and 1980s with adoption by major issuers including Bank of America and networks like Interbank Card Association (now Mastercard International), and integration into systems managed by Federal Reserve Bank infrastructure and retail chains such as Walmart.

Physical design and encoding standards

Cards follow ISO/IEC specifications such as ISO/IEC 7810, ISO/IEC 7811, and ISO/IEC 7813 that define dimensions, location, and coercivity of magnetic stripes. The stripe typically contains three tracks: Track 1 (7-bit alphanumeric) used by issuers like American Express and Airlines Reporting Corporation; Track 2 (5-bit numeric) adopted by banking networks including Visa and Mastercard; and Track 3 (numeric, often unused) reserved for applications such as loyalty programs or secure access control systems implemented by organizations like HID Global. Magnetic particle coatings use high- or low-coercivity materials specified in standards; vendors such as 3M and Fujifilm supplied media. Card construction integrates personalization steps executed by firms like Entrust Datacard and Giesecke+Devrient.

Data formats and security

Encoded formats include the ANSI/ISO-defined field formats for Primary Account Number, expiration date, service codes, and discretionary data used by issuers and processors such as First Data and Fiserv. Security mechanisms historically relied on magnetic track data combined with magnetic stripe verification and machine-readable signature panels used by merchants like McDonald’s at point-of-sale terminals. The rise of EMV chip standards driven by Europay, Mastercard, and Visa introduced cryptographic authentication and asymmetric keys to mitigate risks associated with static track data; card personalization authorities such as Giesecke+Devrient and IDEMIA manage keys and certificates for chip issuance. Tokenization services by companies like Apple Inc. and Google LLC further abstract account data from payments.

Applications and use cases

Magnetic stripe cards serve in payment cards issued by Visa, Mastercard, and American Express; identification badges used by institutions such as NASA and United States Department of Defense; transit fare media implemented by agencies like Metropolitan Transportation Authority and Transport for London (historically before contactless adoption); hotel keycards deployed by chains including Hilton Worldwide and Marriott International; and membership or loyalty cards from retailers like Costco and Starbucks. They are integrated with point-of-sale vendors such as Square (company), ATM networks maintained by Bank of America and JPMorgan Chase, and legacy access control systems manufactured by HID Global.

Vulnerabilities and countermeasures

Magnetic stripe data are static and susceptible to attacks including skimming by devices sold on gray markets, cloning used in fraud rings that have targeted networks processed by entities like Visa and Mastercard, and card-not-present schemes exploited by criminal groups investigated by agencies such as the Federal Bureau of Investigation. Countermeasures include migration to EMV chip cards promoted by the EMVCo consortium, deployment of point-to-point encryption solutions by vendors like Thales Group and VISA Inc. (through programs), use of contactless technologies standardized by NFC Forum and adopted by Apple Pay and Google Pay, implementation of transaction monitoring by processors such as Mastercard and Visa risk divisions, and regulatory frameworks enforced by authorities like the Payment Card Industry Security Standards Council and national regulators including the Office of the Comptroller of the Currency.

Category:Data storage media