Your hand as a Credit Card? Sooner than you think.

As paying with your phone becomes more and more popular, and most of the shopping is done online, Credit/Debit cards seem to be a bit outdated. Having this in mind, and paying close attention to the future trends, VISA is looking to toss them almost completely – replacing them with a process that makes paying for things online as simple as tapping any internet-connected device in your house.

As we see from the graph provided above (source: NCTA), it is expected to have around 50 billion connected devices by the end of 2020. Hence, VISA’s move towards this direction is more than obvious.

We must note that this is not the first time the payment technology company tries to dive into relatively new waters. Last year the company has introduced a contactless ring that could be used to pay for items with a wave of your hand. The ring was distributed to VISA-sponsored athletes for the use at the Rio Olympics. To be frank, nearly the same ring is now commercially available from the company called Kerv. It has partnered with MasterCard so that you could turn your hand into a payment device wherever contactless payments are supported. Kerv Ring is available in 14 color combinations, and you can buy one for about GBP 100.

However, contactless rings or similar devices might only be the solution for the medium term. After seeing the potential in their initial technology, VISA has worked to make it even smaller and cheaper, putting everything into a small plastic sticker that has to be affixed to the back of your hand. That being done – your hand becomes a seamless payment device.

Since the sticker is really unobtrusive, you could potentially keep it on your hand all the time, including your own home, which is (and later will be more substantially) populated with connected devices. VISA’s token system ideally would let you use any of your connected gadgets to shop online and just tap to order from whatever site you want instead of having to whip out a credit card.

It is important to stress that many customers are often hesitant to shop at new or unfamiliar sites due to the need to re-enter all of the shipping and billing information. To add, some of them are afraid that their data might be hacked.

VISA alleviates some of these security concerns by using tokenization, which replaces all of your sensitive information with a randomly generated digital identifier. It is just tap and go, and if the ring, sticker or whatever that contains the token is lost, you can easily turn it off using your credit provider's app. That is much easier than having to call a customer service number to disable a stolen credit card. Moreover, you can turn it back on if you find it later. If a retailer is compromised, it never had any of your billing information in the first place: the digital identifier is useless by itself.

Nevertheless, although everything looks nice and beautiful, there are couple of drawbacks that have to be addressed. First one is security. The ring, sticker or any other item VISA develops probably will not have biometric identification or additional layer of security, as it makes the product more complex and expensive. Thus, if lost or stolen, it can be essentially used by anyone. Second, at the moment (and probably in the beginning of becoming conventional mean of payment) it is limited to VISA customers only. Therefore, not all payment platforms support this technology, which makes it not very convenient.

Bringing it all together

To summarize, we must stress that these and similar developments might suggest that we are not far from more-permanent sub-dermal implants. Despite of the advancements that we currently have, in the future payments & paying experience will become even more seamless (hint: think of Amazon Go store and what Samsung is doing). Yet, security & limited reach are two important components that need to be addressed before paying by hand becomes mainstream.