Card Reader

A card reader is a device used to extract data from a payment card’s magnetic stripe, chip, or NFC (near-field communication) technology. These are the methods used to store personal and account information on payment cards. Nearly all card-present transactions are processed through a card reader

The oldest technology is the magnetic stripe (magstripe), where the card reader would access data made up of magnetic particles on the back of the card. The magstripe has largely been replaced by EMV “chip” cards, where the same information is built into a microprocessor on the card. While most modern card readers can access card data from either the stripe or the chip, magstripes are less secure and card networks are phasing them out altogether.

More recently, some merchants have replaced existing card readers with ones capable of interacting with customers’ smart devices, which enables data to be “read” without the use of a physical card.