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How Does The Magnetic Stripe On A Credit Card Work?

If you have ever looked at your credit card magnetic stripe and wondered what mysteries it holds, then here is a little information, although some of what follows will probably still not make much sense.

One thing you need to understand is that allowing your credit card magstripe to be scratched or damaged is likely to mean it is no longer going to function when run through a merchant card reader.

The credit card magnetic stripe on the back of your card serves many purposes. It provides personal and bank data that is necessary to process your transaction. It also allows merchants to know that your card is good for the amount you want to charge to it.

The credit card magnetic stripe or magstripe as they are sometimes called carries loads of information. Each stripe is made up of iron based magnetic particles that are in a plastic film with each one being a very small bar magnetic of about 20 millionths of an inch. These magnetic stripes are able to have information placed on them because each magnet can be magnetised in the direction of the north or south pole. Each magstripe has three tracks that is one-tenth of an inch wide and each track contains unique data.

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Credit card magnetic stripe functions

There are up to three tracks on credit card magnetic stripes, or magstripes. These are numbered tracks 1, 2, and 3. Track 3 is rarely used, and may not even exist on credit cards because the magnetic stripe may not be wide enough to accommodate it.

There are several formats contained on a credit card magstripe. A is for the card issuer's proprietary use; B is the information required to allow a card reader transaction, and is listed below; C to M are reserved for ANSI use - that's the American National Standards Institute, whose formula also dictates the long number across the front of the card; and N to Z, which are reserved for the individual card provider.

The first track, the A format holds the proprietary information of the credit card company and the B format holds the following data:

  1. One character that is the start sentinel
  2. One alpha only character that is format code "B"
  3. One character that is a separator.
  4. Three characters that are the country code
  5. Two to 26 characters that are your name
  6. One character that is a separator
  7. Four or one character that is the expiration date or separator
  8. Up to 79 characters that contain discretionary information
  9. One character that is an end sentinel
  10. One character LRC (Longitudinal redundancy check)

The second track was developed by the banking industry and contains:

  1. One character that is a start sentinel
  2. Up to 19 characters that are the primary account number
  3. One character that is a separator
  4. Three characters that are the country code
  5. One or four characters that are the expiration date or separators
  6. Up to 40 characters that contain discretionary information
  7. Once character LRC

The third track is a readable and writeable track but does not have standardised usage.

Track 1 and track 2 possess much of the same data, and both possess enough cardholder account information that a transaction can go ahead if one track is unreadable. Technically speaking, track 1 has a higher bit density, and it is the only track that may contain alphabetic text, therefore the only one that lists the cardholder's name.

If you swipe your card and it does not work it is because your credit card magnetic stripe has gotten dirty, scratched, or has been erased. If a magnetic stripe has been in contact with a magnet, like the one on a refrigerator or a stores tag demagnetiser it could be erased.

Merchants have three ways to validate that your credit card is good for your purchases the first is through voice authentication on a touch tone phone. This is generally only used for merchants who have very few transactions to process. The second is through electronic data capture at a credit card magnetic stripe terminal. You have probably used this the most by swiping your card at various retail outlets. The last is by way of virtual terminals, these would be used for online transactions.

If you would like to learn more about credit card magnetic stripes, then you have way too much time on your hands.

Images: Shutterstock

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