Smart cards, a French invention that revolutionised payments (1/2) : before the chip

1974-...

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In 1974, a French engineer developed a ‘portable memory device’ that paved the way to the smart payment card at the end of the 1970s. Offering more security and the potential for new services, this solution was deployed throughout France in 1988, then started to be exported in 1997. Zoom in a cutting-edge technology that became an international standard.

From magnetic strip card to memory card

The history of the smart card goes back to the 1950s, when a number of inventors started entertaining the idea of a portable electronic object that could be used for transactions. But it wasn’t until 1974 that the dream became a reality with Jean Moreno’s invention. In 1971, the Carte Bleue (payment card used by large French banks) was equipped with a magnetic strip that allowed the use of a secret code and saved shopkeepers the trouble of having to send transaction slips to their bank. It was a real time-saver in transactions.  Along with this technological development came the first automatic teller machines (ATMs), for which the magnetic strip card was originally designed before it was used on card-reader devices in shops. While magnetic strips gradually appeared on Cartes Bleues, it was only in 1979 that it became a global standard.

Visa Premier card with magnetic strip, 1985 - BNP Paribas Historical archives

Visa Premier card with magnetic strip, 1985 – BNP Paribas Historical archives

It was also at that time that the first electronic-payment trials started. Introduced in the merchant terminal, the magnetic strip card immediately sent a query to the bank’s computers to receive confirmation that the amount spent by the buyer had been authorised. The system considerably reduced the risk of fraud or improper use, but was also very costly and slow due to France’s telecommunications infrastructure.

For these reasons, the memory card was seen an alternative solution to online payments. Since it was possible to store data on the chip, it was no longer necessary to stay connected to the bank. A new technological revolution was under way, and a promising new market started to emerge.

BNP's ATM in 1986, Avenue des Champs Elysées - BNP Paribas Historical Archives

BNP’s ATM in 1986, Avenue des Champs Elysées – BNP Paribas Historical Archives

 


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The smart card won over the France and the world


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The personal data collected from the Site are subject to data processing by BNP Paribas to enable access to and use of the functionalities offered by the Site www.histoire.bnpparibas.
Pursuant to the French Data Protection Law No. 78-17 of 6 January 1978, you are entitled to access the data collected by BNP Paribas and to have it amended, updated or deleted, where such information is incorrect, incomplete or outdated. You can exercise this right by contacting: BNP Paribas – APAC TDC Val de Marne, TSA 30233- 94729 FONTENAY SOUS BOIS Cedex.

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Since 1822, history has made us a key player and a witness of transformations taking place in society and economy in Europe and around the world. We invite you to share in our story and explore our archives to learn more about our constantly changing world.
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