Are Swipe and Go Banking Cards Safe?

Designed for speed and convenience, swipe-and-go cards have begun to appear everywhere. Consumers can now make credit card transactions merely by waving their card over a scanner without even taking the card out of their wallet or carrying case. The secret is the RFID chips embedded in each card. But do these chips represent a security risk? Do they make identity theft easier? Here is a look at this emerging new technology, and the benefits (and potential drawbacks) of its adoption.

How It Works

RFID stands for “radio frequency identification.” An RFID-enabled card has a small embedded chip that transmits radio waves carrying identifying information. Rather than transmitting that information through the magnetic stripe on the back, an RFID card allows the user to simply hold your card close to a reader to make a transaction. This is faster and easier than the traditional “swipe” methods of older credit cards but it also comes with some potential hazards.

Benefits

RFID cards were created to add an extra layer of security to credit card transactions. One of the main benefits to an RFID card is faster transactions and minimized card exposure the card doesn’t even need to be removed from a wallet or carrying case to perform a transaction, which means a reduced risk of the card being stolen or the numbers read off it. Taking photos of a credit card to copy the numbers off the photo has been a common credit card scam for decades, made much easier and more common by high-resolution cell phone cameras.

The information contained on “swipe-and-go” cards is also encrypted, and with each transaction, the RFID chip creates a new authentication code. This means that if a thief happens to steal your encrypted card information, then breaks the encryption, the most they can do with that information is make a single fraudulent transaction.

Security Risks

RFID-enabled cards were conceived with increased security in mind, but they still have some security vulnerabilities. While fast transactions and limited card exposure are beneficial in preventing identity theft or credit card fraud, “swipe-and-go” cards are far from perfect. The high-tech solution of RFID chips have attracted a smarter, more technologically sophisticated brand of thief, who can scan public places for RFID transmissions and intercept information from mobile devices — using nothing more technologically advanced than a smartphone or tablet. While the encryption may prevent easy identity theft, there have been reports of thieves successfully hacking defeating card encryption.

RFID chips also do nothing to prevent physical theft of the card€” while it might be more difficult for a thief to take photos of credit card numbers, a thief who manages to get a hold of the card itself can still do a great deal of financial damage with it.

Safety Measures

Swipe-and-go cards were built with transaction speeds in mind€” they were designed to be fast, efficient, and easy to use. But the potential security risks are a deal-breaker for some. If identity theft and data protection are paramount issues for you, you may want to consider avoiding getting an RFID-enabled card entirely. If you’re unsure whether or not your credit cards have an RFID chip, you should contact your financial institution and find out.

For peace of mind, wary users can invest in RFID-blocking wallets or carrying cases, which will prevent the radio signals in the chip from broadcasting. While this will not prevent or abrogate physical theft of the card, it will prevent your card’s radio signal from being intercepted by a third party.