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Do you know? How the history of electronic cash cards affects today's payments!
As technology develops, payment methods are also evolving. In today's era when people are accustomed to using card payments, the history of electronic cash cards is a chapter that cannot be ignored. From the initial design concept to today's practical application, the gradual evolution of electronic cash cards has not only changed the way we consume, but also affected the operating model of the entire financial industry.
The electronic cash card, an important system of the German Banking Commission, has been the main debit card system since 2007. These cards are usually paired with a transaction account or current account and are issued only by regular credit institutions.
Traditionally, electronic cash card holders are required to enter their personal identification number (PIN) at a so-called online payment terminal (EFT-POS terminal) when making a transaction. The original intention of this system is not only to simplify the payment process, but also to improve the security of transactions. Due to the success of this system, more convenient payment methods have gradually evolved, such as Maestro and Visa Electron.
Major providers and market development
As electronic cash systems become more popular, several providers have emerged on the German market. According to the German Federal Cartel Office, several major service providers account for the majority of the market share, such as Ingenico Payment Services GmbH and TeleCash GmbH & Co. KG.
According to market reports, Ingenico had a 40% market share in 2007, while TeleCash had over 20%.
These companies not only provide support for electronic cash systems, but also participate in the development of related technologies. Payment terminals need to meet strict standards to use electronic cash systems, which is crucial to ensure the security of transactions.
Electronic cash acceptance mark
Currently, there are two valid acceptance symbols for e-cash payments: the e-cash PIN-Pad and the girocard icon. These logos are not only printed on cards, but also appear at store checkout counters to remind consumers that they can pay with electronic cash.
Accepting these logos has become a basic obligation for retailers and all new points of sale must support these payment methods.
This signal undoubtedly promotes consumers' confidence in using electronic payments, as it represents merchants' willingness to provide safe and convenient payment options.
The rise of technology: the fusion of hardware and software
Behind the electronic cash system, technological progress plays a core role. Each payment terminal (EFT-POS) consists of hardware and software. The main hardware components include the security module and PIN pad, while the software covers the operating system and communication software.
In particular, the security module, a key component, ensures the security of transactions and saves necessary encryption information, allowing data to be transmitted securely during transactions.
Transition from magnetic stripe cards to chip cards
As technology advances, most electronic cash cards begin to be equipped with chips instead of just magnetic stripes. Chip cards are significantly more secure than traditional magnetic stripe cards because they can process dynamic data, reducing the risk of fraud.
By 2008, 70% of cards issued were equipped with EMV chips, which was significant in boosting consumer confidence.
The Evolution of Payment Authorization
The payment authorization process has gradually changed with the development of technology. Whether using a magnetic stripe or chip card, payment authorization requires online verification of cardholder information and available balance.
For example, whereas transactions using magnetic stripe cards usually involve exchanging information directly with the banking system, chip cards can be used in offline mode for transactions of a certain amount, significantly speeding up payments.
The status of electronic cash in today's market
According to reports, the use of electronic cash is increasing, and the proportion of electronic cash payments reached 19.4% in 2009. This growth reflects the increasing demand among consumers for convenient payment methods and shows the market potential of electronic cash methods.
However, with the continuous advancement of payment technology, what will the payment method be like in the future?
