By Jessica Duncan, AVP Research & Insights
Despite the growth of card transactions occurring through digital payment methods, the physical card will still matter in 2024, and as long as there is a physical card, innovation will continue for both security and aesthetic purposes. In the coming year a notable card element will be discontinued. From the removal of the magnetic stripe (magstripe) to the use of recycled plastic and glow-in-the-dark materials, card designs in 2024 will be a modern mix of form and function.
Mastercard to Phase Out the Magstripe in 2024
Two years ago, Mastercard announced that in 2024 it would begin to phase out the issuance of cards with a magstripe. This announcement was a major signal that the network was committed to transitioning to the more secure chip technology. The accelerated adoption of contactless payments during the COVID-19 pandemic likely gave Mastercard the confidence to discontinue the magstripe, which has been the credit card standard for over five decades. The network has stated that by 2029, no new Mastercard debit or credit cards will have a magstripe, and they’ll be completely phased out by 2033. In recent years, magstripe transactions have become the riskier payment method due to a fraud technique known as skimming, which could occur at ATMs, fuel pumps, and other Point of Sale (POS) terminals. While Mastercard’s decision was presumably based on security, the removal of the magstripe could also further propel a switch in card orientation.
Horizontal cards have been the prevalent orientation due to function – Picture how nicely a card’s branding shows when placed within a traditional slot of a wallet or the ease of swiping the card through a POS terminal when holding the card on its side. Now, the act of tapping or ‘dipping’ the card into the terminal lends itself to a vertical design. Vertical cards exist in the marketplace but have yet to take off in large scale. We could see that change as consumers further adopt to the tap/dip methods.
From a marketing standpoint, Competiscan does not predict that this functional change will require dedicated marketing attention. Instead, it may result in product design discussions and reissuance schedules as issuers switch to vertical cards. Marketers will also need to create a fresh arsenal of imagery and visuals to use within marketing materials. The image of the card art remains a staple design element in both acquisition and loyalty marketing. Card marketers should continue to reinforce modern transaction methods and its card orientation through visual examples.
Card Number Placement
From large embossed numbers to the more recent laser printing, the historical placement of the account number was always on the front. Chip technology has rendered the account numbers for that purpose unnecessary, which has allowed issuers to transition the account number to the backside of the card. This shift in placement has been driven by both function and aesthetics. For security, the account number placed on the backside is less visible to bystanders. Plus, all of the card information is now located in one place for the cardholder, and the frontside offers a sleek canvas for design and branding elements.
Check out how TD Bank has designed its newer cards. The bank has stacked the 16-digit number in groups of four on the backside of the card. When cardholders received this new card format in the mail, the bank included a great visual and guidance within the card carrier; Pointing out why they made this change and other important notes, like not having to sign the card.
Environmentally Conscious
Something else that TD Bank pointed out was that the card was made of 90% recycled plastic. The use of recycled plastic, another growing trend, is an important way for companies to reflect their sustainability efforts. U.S. Bank has promoted its use of recycled plastic and utilized one of the featured benefits within an Altitude Go Visa mailer to state that the card was “A more sustainable way to pay” and was made from recycled plastic and “designed to help reduce the amount of plastic waste in the environment.” American Express has also been observed calling out its use of recycled plastic, using statements like “Your 99% recycled plastic Card will be arriving soon.”
Modern & Innovative Designs
Lastly, we can’t talk about 2024 and credit cards without mentioning Gen Z. This segment of consumers, currently aged 11 – 26, accounts for approximately 20% of the total U.S. population and represents the fastest-growing audience for credit cards. According to a recent Pymnts.com article*, Gen Z reportedly put 50% of their total spending on a bank-issued credit card. American Express also stated in its July 2023 earnings report, that 60% of new consumer accounts were held by Millennials and Generation Z. More interestingly, 45% of the Gen Z respondents were only carrying one bank-branded card. This signals a need to first capture the attention and then retain the loyalty of this demographic segment.
While rewards and convenience remain two of the core pillars of a card’s value prop, it will also be important for issuers to consider how the card aesthetic may appeal to this younger audience. It’s likely Gen Z is carrying a lower number of cards due to their new-to-credit status, and Competiscan has observed some interesting and innovate design options, particularly with products designed for teens or credit starters.
For example, Cash App brought card design into the new era with options for its Visa debit card that include glow-in-the-dark, chameleon metal, or a design that you can draw on. Card design for Cash App is not just a secondary mention, but was seen as the entire focus of a Cash App Cash Card acquisition email observed in August 2023.
There also remain a variety of card products that offer customization of card art at no additional charge, such as top card marketers Discover and Wells Fargo. For Marvelvfans, Chase recently unveiled new Super Hero card designs available with its Disney cobrand portfolio.
The security of using a physical card will remain the most vital influencer of card design going forward, but how it looks is still very much important. Seeing someonevtake out a uniquely designed card might capture stronger attention than a standard looking card. This just might be the differentiator that a card program needs to stand out in the highly competitive payments space.