As we inch closer to the holiday season, gift cards will likely be in high demand to send to relatives, friends, teachers and more.
Infineon Technologies AG has launched two secured prepaid tag solutions to increase the security of gift cards and limit consumer risks. Annually, consumers in the U.S. experience losses of $1 billion due to tampering.
Infineon’s secured EMV prepaid tag solution focuses on open loop gift cards, while secured prepaid tag solution is offered for closed loop gift cards.
The security additions address the challenges of gift cards by replacing the need for visible codes, barcodes or magnetic stripes with a secured chip using cryptographic mechanisms, Infineon said.
The chip is access through near-field communications (NFC) devices using a smartphone authenticated with data. This allows both retailers and consumers to tap the gift card for activation, check the balance or redeem assets, the company said.
Why it is needed
The U.S. Federal Trade Commission (FTC) said that 25% of all fraud reports are related to gift card fraud. About 34% of U.S. adults have been or know someone targeted by gift card scams.
While consumers are out of the money it is also hard for merchants to identify, manage and resolve card fraud. Infineon cites Chargebacks911’s data that estimates gift card fraud generates merchant costs of four dollars on every dollar lost to gift card fraud.
