Global credit card giant Mastercard is now finally started exploring usage of Blockchain technology in securely verifying payment cards at the point-of-sale (PoS), in order to curb skimming of credit cards.
For uninitiated, Skimming is a method used by identity thieves or hackers to capture information from a credit card holder. To restrict this, Mastercard is going to put credit card payment on a public blockchain.
According to a patent application filed with the U.S. Patent and Trademark Office (USPTO) and released on Thursday, Mastercard has come up with a conveyance and retrieval processes to verify users’ payment credentials over a “publicly accessible blockchain.”
The patent application document explains that the two-way method first encodes an image of a payment card and then stores it on the blockchain after encryption with a public and private key. Upon a retrieval request when a payment is being made, the system will use the provided private keys to decrypt the image so it can be verified.
Mastercard intends to use this system with PoS devices to make transactions highly secure, as the card need not be physically presented, and users need not be concerned about their payment credentials being “skimmed” from the payment device.
Notably, this is not the first time Mastercard is exploring blockchain technology as earlier, in October 2017, Mastercard has already started offering the ability to send money over a blockchain tech rather than by swiping a credit card by opening up its blockchain to certain banks and merchants as an alternative method of paying for goods and services.
Additionally, in an another blockchain-related exploration by Mastercard, it was revealed in the same patent update, that the company is also seeking to build a blockchain to allow consumers to broadcast their travel itineraries and reservation requests to merchants.
Last November, MasterCard had also filed a patent for instantaneous payments using blockchain technology that
Meanwhile, an another credit card giant Visa had already forayed into blockchain world when the company, in last November, rolled out the first, pilot phase of its blockchain-based business-to-business payments service, B2B Connect, to ease cross-border payments by facilitating direct payments between institutions, cutting out the middleman the industry currently relies on.
The transparency and irrefutability of blockchain-based transactions make fraudulent manipulation of data almost impossible due to the very fact of Blockchain’s underlying process i.e — If data is changed on one node, every other node would have to reflect that change for it to take effect. In terms of hack-resistance, there is no contest between blockchain and traditional, centralized banking.