Voice of the Industry

New card payment technologies and the race to keep up with mobile payments

Thursday 3 November 2022 09:00 CET | Editor: Raluca Ochiana | Voice of the industry

Nick Maynard, Head of Research at Juniper Research, dives into new use cases for biometric cards and the importance of premium experience.


Over the years, payment cards have been a part of the financial lives of individuals and businesses as an end product of complex payment systems. They also have been instrumental in advancing the underlying payments technology and answering customer preferences and needs. Despite many parties predicting the death of cards with the advancement of digital and mobile payment methods, including BNPL (Buy Now, Pay Later), payment cards are still prevalent and are undergoing a significant technical transformation, especially in terms of infrastructure and authentication systems. Technologies such as contactless, biometric cards, and even digital issuance via virtual cards are changing the customer proposition.

Biometric payment cards advancing new use cases

Emulating biometric authentication largely utilised in smartphones and other mobile devices, biometric payment cards eliminate the need to enter PINs for payment transactions as a unique identifier. Biometric cards feature a fingerprint sensor which stores a user’s reference data in the card’s secure chip. This sensor is powered by the chip, while the card itself is powered by the POS terminal by charging the chip. No further upgrades to terminals by merchants are needed to accept biometric payments. This critical element here is that this enables cards to have unlimited contactless transaction values, allowing them to finally match the level of convenience that mobile payments offer. 

Biometric payment cards were first deployed in the UK by Natwest in 2019, in partnership with Mastercard and Gemalto (now Thales), as part of a trial with a limited number of customers. More recently, in June 2021, BNP Paribas launched its biometric cards offer to its customers with Thales, after deploying successful trials since 2020. These deployments show that, while progress has undoubtedly been made in the early phases, the concept is gaining further traction in the market, and we anticipate strong growth, as issuers look to differentiate themselves and their offers to users.  

Dynamic CSC/CVV cards offer an alternative

Embedded in payment cards as a counter-fraud solution, dynamic CSC (Card Security Code)/CVV (Card Verification Value) involves the replacement of the static CVV or CSC at the back of the payment card with a randomly generated number at time intervals. This eliminates the risk of any static CVV information being stored or compromised and can greatly reduce the risk of CNP (Card Not Present) fraud, by also offering the ability to include such dynamic data in the authorisation message sent to issuers. The code appears at the back of the card on a small ePaper screen by using eInk. Issuers such as Visa and Mastercard have created algorithms for dynamic CVV generation, with which leading manufacturers comply. 

These developments are important because they allow issuers to take concrete steps to tackle CNP fraud, which has been difficult to identify, as payments have gone increasingly digital. However, the increased cost per card means that this will indeed remain niche and will require further trials to demonstrate the value proposition to users. 

Metal cards and the importance of the premium experience

Metal cards are tougher and more stylish alternatives to plastic payment cards, which are often presented as ‘premium’ to customers. These cards are specifically designed to offer a superior look and feel compared to their plastic counterparts and can be produced in various grades and styles, as required by issuers. To accelerate their uptake, these cards need to be better marketed to wider customer segments, outside of top tier accounts. Issuers need to work out how to effectively sell these cards at higher price points to a wider audience within their client bases, or they will fail to achieve significant revenue from this area. 

Metal cards also face a significant challenge from other card types, which can also offer a premium feel, such as eco cards featuring recycled content, or wooden cards. Metal cards must therefore be paired with attractive user account features, rather than just relying on their premium nature alone. 

The future of payment cards

Ultimately, there is no right answer when it comes to the future of payment cards – no one-size-fits-all approach will work. However, what we are seeing is a multitude of right answers, for different demographics and customer types. Biometric cards, metal cards, and dynamic CVV cards all have a role to play, but targeting these solutions to the right users will be a challenge that will involve partnerships with card issuers.

Figure 1: Global Card Technology Revenue for Card Manufacturers (USDm), 2022 & 2026

Global Card Technology Revenue for Card Manufacturers

Source: Juniper Research

Ultimately, it is the responsibility of card technology providers to guide issuers through the process of updating their cards, identifying where value can be added, and how to drive their brands forward best. Card manufacturers need to keep their portfolios broad enough to offer the capabilities issuers may need but detailed enough to match the very specific requirements issuers may have. If card manufacturers can get this balance right, they can unlock significant revenue. 


This article was first published in Payment Methods Report 2022, the most updated overview of trends and developments in the payment methods space and the innovative technologies that these methods work upon, emerging consumers habits, and strategies on how to win at conversion and retention.

About Nick Maynard

Nick Maynard is Head of Research at Juniper Research. His key area of focus is the fintech & payments area, including embedded finance, open banking, and digital wallets, among others. 




About Juniper Research

Juniper Research specialises in providing best-in-class market research across mobile, online, and disruptive technologies. We offer in-depth reports, forecasts, annual subscriptions, and consultancy. Our global clients include banks, payment providers and many others. To find out how we can help you, contact info@juniperresearch.com or visit www.juniperresearch.com.

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Keywords: payment methods, biometric authentication, CNP fraud, Card-not-present fraud, card security code
Categories: Payments & Commerce
Companies: Juniper Research
Countries: World
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