Visa has announced significant changes to how credit and debit cards will operate in the U.S., potentially leading to Americans carrying fewer physical cards in their wallets. The modifications aim to make the traditional 16-digit card number less relevant in transactions. These changes mark one of the most significant shifts in payment operations since the introduction of chip-embedded cards in the country.
Americans now have a plethora of payment options beyond credit or debit, including buy now, pay later services, peer-to-peer payments, direct bank payments, and digital payment systems like Apple Pay. Visa's global head of consumer payments highlighted that these new features could eliminate the need for consumers to manually enter account numbers in the future.
One of the major changes is the introduction of a single physical payment card that can be linked to multiple bank accounts. This innovation will allow users to set preferences with their bank, such as allocating specific types of purchases to either a debit or credit account. The feature, already in use in Asia, is set to be available in the U.S. this summer, with Affirm being the first company to roll it out.
Visa's updates are partly in response to the rise in online payment fraud, which is more prevalent as digital payments become more widespread. The company estimates that online payment fraud occurs seven times more frequently than in-person fraud. To combat this, Visa is introducing new tap-to-pay features that enable users to add cards to mobile wallets by tapping them to their smartphones. Additionally, biometric authentication methods, like fingerprint or face scans, will be implemented to approve transactions.
While these features will take time to be adopted by banks, they are in response to demands from financial institutions that issue Visa cards. The future envisioned by Visa executives involves cards where the 16-digit account number is largely symbolic, reflecting the evolving landscape of payment technology.
