Gift Card Technology -

Gift Card
Technology

Plastic gift cards have become ubiquitous in the modern retail landscape. They're not just a means to give someone a monetary gift; they're also a powerful tool for businesses to increase sales, loyalty, and brand awareness. But how do these little pieces of plastic hold information, and how do they work? Let's delve into the technology behind them.

Card Technology

From traditional magstripes to state-of-the-art EMV chips and NFC capabilities, modern gift cards ensure that the shopping experience has never been easier or more secure.

Magstripe

A Magnetic stripe or Magstripe conatins tiny iron-based magnetic particles embedded in a plastic-like film. The particles can be magnetized in either a north or south pole direction, which translates into binary code to be read by a magstripe reader. When the card is swiped through a card reader, it reads the binary code and verifies the card's details and its balance. Magstripe technology is cost-effective and widely used today although smart chips are slowly but surely becoming more popular .

Smart Chips

Smart chips, are tiny microprocessors embedded into the card. A small metal chip is embedded into the card, and the chip securely stores data and performs cryptographic processes. Rather than swiping the card, users "dip" it into a reader. This process creates a unique transaction code for each purchase, making it far more secure than the magstripe. While more commonly found in credit and debit cards due to security reasons, some gift cards now also feature this technology.

Barcode

Many gift cards also have barcodes or QR codes printed on them. These are patterns of lines or matrices that can be scanned by a reader or smartphone to relay information. When scanned, the system can quickly retrieve the card balance and other related details. This is a simpler and less secure method compared to magstripes or Smart chips but it still widely used often on gift cards for smaller retailers or promotional uses because of its simplicity and cost-effectiveness.

Frequently Asked Questions

A small river named Duden flows by their place and supplies it with the necessary regelialia. It is a paradise

What is the difference between a magstripe and an Smart chip on a gift card?

A magstripe, or magnetic stripe, is a band of magnetic material on the back of the card that stores the card's information. When the card is swiped through a card reader, this information is read and processed. On the other hand, an EMV chip, commonly known as a smart chip, is a tiny microprocessor embedded into the card. This chip securely stores data and requires the card to be "dipped" into a reader, creating a unique transaction code for each purchase. EMV chips offer enhanced security compared to magstripes, making them more resistant to cloning and fraud.

Are gift cards with QR codes and barcodes less secure than those with magstripes or Smart chips?

In general, QR codes and barcodes on gift cards are primarily used for quick scanning and do not have the same security mechanisms as magstripes or EMV chips. While they can quickly relay information about the card's balance and other details, they lack the encryption and unique transaction features of more advanced technologies. That said, many gift cards with QR codes or barcodes also include additional security features like PINs or CVVs to enhance security during redemption.

Can I use my gift card's NFC or RFID feature with any card reader?

Not all card readers are equipped to handle NFC (Near Field Communication) or RFID (Radio-Frequency Identification) transactions. To use the contactless feature of a gift card, the merchant's card reader must be NFC or RFID compatible. However, as contactless payment becomes increasingly popular, more and more merchants are upgrading their systems to accommodate this technology. If in doubt, check with the merchant or look for the contactless symbol on their card reader.