The ROI On New Card

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DES MOINES, Iowa — Jeff Russell, EVP of The Members Group here, said the LCD card being piloted by MasterCard is another example of the payments industry seeking solutions to credit card fraud and consumers' needs. "The industry is trying to figure out what is that next step as we transition to other types of payment technology, away from the mag stripe. Will that be EMV? Maybe we skip straight to mobile devices?"

Russell believes the LCD card is targeted more toward online purchases rather than in-store, where he said some changes to the POS system may have to be made to accept the pass codes. "The other barrier is cost. Until you get these new technologies into mass production the cost will be significantly higher to manufacture them than standard mag-stripe plastic."

Russell said what could boost acceptance of the smartcard is if the increased cost for the card is well outweighed by fraud savings the new plastic provides. "The equation most issuers will run is how much would I have to save in fraud to pay for the additional plastic costs. If that number can be widely positive, then it makes sense to adopt this at a higher level."

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