Working Principle & Manufacturing of Magnetic Stripe Cards

Are you wondering how the credit card works? What is the History and Manufacturing Procedure of Credit Card i.e (Magnetic Stripe Cards). You are at the right place. 

Introduction

A magnetic stripe card is a type of card capable of storing data by modifying the magnetism of tiny iron-based magnetic particles on a band of magnetic material on the card.

The magnetic stripe, when combined with point-of-sale devices, data networks and transaction-processing computers, was the catalyst that accelerated the growth of the global credit card industry. Approximately 6 trillion USD in transactions is handled per year by this technology. Initially used on transit tickets for the London underground and California’s Bay Area Rapid Transit system the technology is now commonplace on ID cards, drivers’ licenses, security control cards and ATM cards.

History

The first person to affix magnetic media to a plastic card for data storage was IBM engineer Forrest Parry. This was back in the early 1960s. The story goes that he wanted to combine a strip of magnetized tape with a plastic identity card for officials of the CIA, and he couldn’t figure out how to do it. When he mentioned his problem to his wife, who happened to be ironing clothing at the time, she suggested that he use the iron to essentially melt the strip on. And that’s what he did. IBM became a pioneer in magnetic stripe technology. IBM decided not to patent the stripe or the stripe production technology as they wanted everyone to use it.

The major development of the magnetic striped plastic card began in 1969 at the IBM Information Records Division (IRD). It took almost two years for IBM IRD engineers to not only develop the process for reliably applying the magnetic stripe to plastic cards via a hot stamping method, but also develop the process for encoding the magnetic stripe utilizing the IBM Delta Distance C Optical Bar Code format. This engineering effort resulted in IBM IRD producing the first magnetic striped plastic credit and ID cards used by banks, insurance companies, hospitals and many others.

How Credit Cards Work

On the back of a credit card is a black stripe called magstripe. This stripe is made of ferromagnetic particles. These particles can be considered as very small bar magnets. These particles are oriented in specific directions to carry information. To read this information the credit card is swiped through a card reader. The card reader is made of a solenoid.

Faraday’s law states that a current will be induced in a conductor which is exposed to a changing magnetic field. Lenz’s law of electromagnetic induction states that the direction of this induced current will be such that the magnetic field created by the induced current opposes the initial changing magnetic field which produced it. The direction of this current flow can be determined using Fleming’s right-hand rule.

As the tiny magnetic particles move through the card reader the magnetic flux changes changing the voltage and the direction of the induced current. A program in the reader processes the changing current and translates it into readable information.

Manufacturing of Credit Cards

The body of the credit card other than the magnetic stripe is usually made up of polyester, PVC, paper or amalgamation of some metals. The stripe of the card is made using magnetic materials.There are two types of magnetic materials that can be used to make the stripe

1. Iron Oxide(Low coercivity)
2. Barium ferrite(High coercivity)

The material of the stripe after being chosen is mixed with resin.Resins are usually mixtures of organic compounds. This mixture is called as slurry. The slurry is coated onto a substrate or backing which can be a plastic sheet.

Once the slurry is coated onto the substrate the particles in the slurry are aligned to give a good signal to noise ratio. The substrate with the wet slurry is passed through a magnetic field to align all the particles.

The slurry on the substrate or backing is sliced as per the specific stripe widths and applied to the card. The methods of application include lamination (where the stripe and backing is laminated into the card), hot-stamp (where a heated dye is used to transfer the stripe from the backing onto the card after the card is cut to size), and cold-peel (where the stripe is peeled from the backing, and then laminated into the card). Another method of putting a stripe on a card is direct coating. In this case, the slurry is coated onto the card directly