The credit card industry’s switch to microchips is expected to improve security at the point of sale, but fraudulent online purchases remain a big vulnerability.
A new credit-card company called Final, which launches today, is aiming to fix that problem.
Oakland, Calif.-based Final generates a unique credit-card number for each merchant where the customer makes a purchase. If the number falls into the hands of criminals, it cannot be used at other retailers.
“You can silo off those relationships, and they become highly controllable,” said Ben Apel, the firm’s vice president of marketing.
Final’s security methods are conceptually similar to tokenization, which replaces the static account number with a one-off code that cannot be used elsewhere. Tokenization is a key part of many digital payment security measures such as Apple Pay, and can also be used as part of the EMV migration.
The Final card is co-branded with First Bank & Trust in Brookings, S.D. It offers 1% cash back on all purchases, and charges an 18% annual percentage rate that will fluctuate as interest rates change. Final is not charging an annual fee for the first year, but customers will pay $49 annually in subsequent years.
Final was founded in 2014 and has raised $9 million in capital. While the firm hopes that its security methods will differentiate its product from others on the market, it figures to encounter competition from better established firms.
Earlier this month, Apple announced that its Apple Pay service, which offers enhanced security through the use of the iPhone’s fingerprint sensor, will be available as a payment option at checkout on merchant websites starting this fall.