An On-Off Card Patent
Written by Evan SchumanA U.S. Patent for a payment card that can be turned on and off was issued last year with little fanfare, but it’s owners are now starting to shop it around to retailers and banks. The premise is that when the consumer turns off the card, neither the card nor its associated numbers can be used for any purchases.
If it works, this could represent a different payment data strategy, because it would make the card data useless to a thief. The full Patent description also discusses how a mobile phone can be integrated into the process for additional payment authorizations. That phone would alert the consumer if someone tried using the card.
It’s not clear whether the business plan will fly, though, given that each card costs about $6, the only retailer the company says it’s talking with is Target and there are only 18,000 current cardholders, according to Nancy M. Torosian, CFO for Assured Debit Card LLC. But it is a novel approach to payment card security. That Patent makes for interesting reading.
Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code.
-Marc
