A mobile app an a system generating disposable card numbers can protect against fraud

Mobile app protects against credit card fraud

A new cheap way to protect against credit card fraud has been developed, which turns plain-text card information into electrical current to prevent data theft. 

Developed by engineers from the Northwestern University and Lehigh University in Bethlehem, USA, the new method known as SafePay has been described as being much cheaper than currently used techniques.

"Because SafePay is backward-compatible with existing magnetic card readers, it will greatly relieve the burden of merchants in replacing card readers and at the same time protect cardholders from mass data breaches," said Yinzhi Cao from Lehigh University, who led the research.

It is the ability to turn the plain-text card information into electrical current that protects against skimming and other common types of attacks.

Previously, integrated circuit cards and mobile wallet systems have been proposed to protect the data, but all of these are incompatible with current card readers, making it too costly and time-consuming for the retailers to implement.

The SafePay system consists of a mobile app and a server which distributes disposable credit card numbers. It uses a magnetic credit card chip controlled by the mobile application communicating directly with the bank server. During transactions, the mobile application acquires disposable credit card numbers from the bank server, generates a wave file, plays the file to generate electrical current and then drives the magnetic card chip via an audio jack or Bluetooth.

The disposable credit card information expires after a limited time or number of usages so, even if the information is leaked, it cannot be used for future transactions.

The magnetic credit card chips, worth $0.5, make the system completely compatible with existing credit card readers.

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