When You Swipe Your Credit Card, Does it Take Just the Numbers?

The magnetic stripe on your credit card provides key payment data when swiped.

The magnetic stripe on your credit card provides key payment data when swiped.

Swiping your debit or credit card at your favorite retail store or an ATM initiates the transfer of information from the magnetic stripe on the back of the card to the terminal. The terminal then connects to an acquiring service that verifies the account information and approves or denies your purchase. To properly verify the account, your credit card number is pulled along with additional pertinent data.

Magnetic Stripe Tracks

The magnetic stripe on debit and credit cards contains three tracks that store a variety of information needed to authorize the purchase at the point of sale and process it through the store's merchant account. Your name, account number, card verification code, expiration date and personal identification number are embedded on the first track. As a form of backup, the second track repeats this information minus your name. Not all cards utilize the third track on the magnetic stripe, but when it is used, it specifies spending limits and other restrictions unique to your account.

Information Not Kept on Magnetic Stripe

Beyond the 26 character spaces that make up the name field on track one, the magnetic stripe on your credit card contains no personal information. Even though your credit card company keeps your address and Social Security number on file for billing and identity verification, this information is not encoded on the stripe. If you have a credit card that requires additional data input at a point-of-sale terminal, such as the billing zip code, the acquirer processes and approves your answer.

Comparison with Online Shopping

Remembering the information pulled from the magnetic stripe when you pay with plastic may be easier if you compare the retail payment experience to online checkouts. When you make purchases or pay bills online, the merchant or payment processor typically requires your credit card number, the card's expiration date, the name on the card and the card verification code. The data you must manually input online is automatically retrieved when you pay in person and swipe.

Protect Your Magnetic Stripe

A portion of fraudulent charges on credit cards takes place while the original card is still in the owner's possession. Thieves can use a device known as a skimmer to record the data on your magnetic stripe and add the information to a new card. To protect your credit accounts, always double-check the swiping portion of card readers and ATMs for obvious signs of damage. If the reader seems thicker than usual or looks like an extension has been added, visit a different ATM.


About the Author

Ashley Mott has 12 years of small business management experience and a BSBA in accounting from Columbia. She is a full-time government and public safety reporter for Gannett.

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