Banks Rework Credit Cards With New Technologies

Get ready for credit card 2.0.

Citibank (C) is about to begin testing a card with two buttons and lights to let users choose whether they want to pay with rewards points or credits, The New York Times said.

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Other issuers are giving their cards makeovers as well. Some cards could double as credit and debit cards, or provide additional security measures. One card shows a portion of the account number only when the user enters a PIN.

Credit card technology is centered on the magnetic strip, which was invented in the 1950s. In Europe, issuers now put out credit cards with a magnetic chip and the cards require a PIN.

Still, credit cards may not have much of a future. New technologies are working to develop payment systems based around mobile phones.

In the meantime, issuers are working on cards that could contain four-year batteries and lots of buttons.

"It's a big deal," said Megan Bramlette, director of research for the Auriemma Consulting Group. "If once a month a consumer can fill up their gas tank for free, and they don't have to do anything except push a button before they swipe their card, that's cool. And that is something that I think will resonate with consumers."