Abracadabra! Alakazam! With a wave of your magic credit card, you'll soon be able to pay for anything you want -- without having to figure out which way to swipe the card reader.
It sounds like a cool trick, and it's hard to deny the convenience factor. But believe it or not, not everyone's happy about swipeless credit cards.
What's the holdup?
The idea behind swipeless credit cards was all the rage a couple of years ago, when ExxonMobil's
But it's been slow going to get swipeless cards up and running. One reason is everyone's concern about identity theft. As vulnerable as you may feel to identity thieves watching you as you swipe your card, the idea of tech-savvy crooks picking up your personal information through the airwaves feels even less secure. Despite assurances from card companies that multiple encryption will protect you from fraud and the continuing protection credit cards give you in the event someone does capture your information, it's still hard to dispel the image of an electronic pickpocket sweeping your wallet or purse with some electronic gizmo.
Many retailers are also likely resisting swipeless technology. Swipeless credit may make checkout faster, which is good for retailers. But the changes will force merchants once again to replace all their credit card equipment with new scanners that will pick up the swipeless card signals. And retailers' concerns go beyond capital expenditures. Another problem is that the easier it is to use credit cards, the more likely it is that people will use them for tiny transactions, like buying a pack of gum or a candy bar. Credit card companies charge sellers a disproportionately high percentage on small sales, eating into profit margins. That's why you'll sometimes see minimum purchase requirements for customers using credit cards in some small businesses.
Still, credit card issuers are finally making some headway. U.S. Bank, an arm of US Bancorp
One step forward, two steps back
It's funny how credit cards have evolved, especially in light of security concerns. On one hand, features like having your photograph placed on the credit card were supposed to make it almost impossible for thieves to use your card. On the other hand, card readers have almost eliminated the need for cashiers to look at your card at all. It's highly unusual to have clerks ask to see your card unless there's a problem with your account.
That said, with wireless technology becoming so commonplace that telephone land lines and Ethernet cables are rapidly becoming a thing of the past, it's probably inevitable that the current card readers will join carbon-copy credit card receipts in the back room at the Smithsonian. For now, though, you'll probably need to keep on swiping -- at least for a little while longer.
You can get more information about the latest in credit card improvements in our Credit Center. You can also find out how to get better rates, choose the card that will best fit your shopping patterns, and much more.
Fool contributor Dan Caplinger isn't in a hurry to go wireless with his credit. He doesn't own shares of the companies mentioned in this article. MasterCard is an Inside Value recommendation. US Bancorp is an Income Investor selection. The Fool's disclosure policy is a secure bet.