Credit Card Design

Credit cards are designed with complex security features to prevent the possibility of fraud. These features involve the card's account number, its signature panel, and its magnetic stripe. The card's unique account number is the key piece of information needed to conduct a financial transaction and must be carefully protected. To prevent someone from using a wrong account number, or from making up a phony number, companies rely on the laws of statistics for protection. By using long account numbers they make it unlikely that a number can be faked. For example, the Visa card has 13 digits, American Express has 15, Diners Club 14, and MasterCard has 20. Mathematically, nine digits would provide one billion unique account numbers (000000000, 000000001, 0000000002, and so forth up to 999999999) which would be enough for all the customers of a given company. (The largest companies, Visa and MasterCard, only have about 65 million customers.) If only 65 million numbers are assigned out of a possible 10 trillion possibilities, it is unlikely that anyone will be able to mistakenly use another account number. If an incorrect account number is mistakenly entered by a store clerk, it will almost certainly not be accepted. This statistical security gives companies confidence that someone is not making up a number when conducting business over the phone. Of course, this security measure does not help if someone obtains a real number and uses it fraudulently.

Another security design feature involves the signature panel on the back of the card. The signature is intended to document the owner's handwriting so a forged signature on a receipt can be detected. To prevent criminals from erasing the back panel of a stolen card and putting on their own signature, the panel is printed with a fingerprint design that is difficult to duplicate and that will come off when the original signature is erased. If the signature is erased, this design will disappear too leaving a white spot, which instantly indicates the card has been tampered with. Some card manufacturers imprint the word VOID beneath this panel, which is revealed upon erasure.

The magnetic stripe on the back of the card is a third security feature. The stripe is an area coated with particles of iron oxide that can be encoded with binary information, which identifies the card as authentic. It is difficult to determine exactly what information is coded on the strip because for security reasons companies do not wish to discuss this. However, it is likely that the card's expiration date is one fact recorded on the strip because automatic teller machines (ATMs) will retain cards that have expired. It is unlikely that information like credit limit, address, phone number, employer, is recorded on the stripe because banks do not reissue cards when this type of information changes.

Finally, some cards feature special features that make them hard to duplicate, such as complicated holograms.