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Driver License = Debit Card?

By Patrick | May 18, 2007

Again, this has privacy nightmare written all over it. An article entitled “Use Your Driver’s License as a Debit Card” ran in Tuesday’s BusinessWeek. The general premise is that why should we as consumers, be burdened down with all these credit cards, debit cards and customer loyalty cards, when we already have a driver’s license that (most likely) has a magnetic strip on the back of it and could serve as a debit card.

A company by the name of National Payment Card has been working over the past couple years on a campaign to get gas stations to sign up with their e-check Driver’s License payment program. It’s a simple process really. All it takes is your driver’s license number and bank account information and you’re good to go. Government (Driver’s License) and Business (NPC) mixing together in a far too close manner. I just don’t like it from a privacy standpoint.

What happens if your DL gets suspended? What happens if your bank account gets frozen? Are the two entities, government and commercial, going to start sharing data and trends without your knowledge? Will hackers begin cloning debit cards based off of DL info? When you go into a bar that is using new DL scanning technology, will you have to worry about unscrupulous bar owners or bouncers compromising your account?

NPC claims to have tough security in place consisting of a PIN that must be entered for every transaction, just like a bank debit card. Also, after three failed PIN-entry attempts, the debit card portion is locked out. Most likely, this isn’t going to be a huge risk of your banking data, as the financial data is stored nowhere on your DL. However, your license information is stored on NPC’s servers to as to properly tie your information together.

Most Public Safety Departments are NOT endorsing NPC, or anyone else who “piggybacks” on any state-issued property. However, the majority of NPC users are loving the technology and wishing that more retailers would accept this type of payment. The gas stations and convenience stores already participating in this program are definitely in favor of the new payment method as they get to escape almost 80% of the normal transaction fee most credit card companies are charging. This in turn allows them to pass along some of those savings to you.

From a business standpoint, it’s bound to succeed in my opinion and make the investors mega bucks. This is why I wish I could invest in the program. Maybe that’s hypocritical since I’m condemning the idea, but since I’m a avid investor and business “watcher”, I can’t help but be intrigued by the potential of this new concept.

To be loyal to my privacy concerns and the business side of me as well, I offer this suggestion: Create an NPC card and send that to all your customers so they can use that, instead of their license. Now you may ask, what’s the difference between that and just another credit card? Not a whole lot on the outset. But if enough retailers begin to accept NCP cards as payment instead of their normal loyalty cards that you always have to swipe, then that could cut down on the amount of plastic in your wallet and still maintain your privacy. Well, as much privacy as can be had when you are a person that signs up for such things as loyalty cards (see my opinion on loyalty cards by visiting this site: http://www.nocards.org).

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Topics: Corporate | 1,434 Comments »

1,434 Responses to “Driver License = Debit Card?”

  1. Randall Shake Says:
    May 31st, 2007 at 12:49 pm

    Dear Privacy Guy,

    National Paymentcard LLC in Boca Raton is attempting to leverage technology and the Free Market to change the current paradigm for electronic payments in the US. My name is Randall Shake. I am CEO and Founder of ACH PAY LLC in Dallas, Texas. And a marketing partner of National Paymentcard. We have a 10 year exclusive marketing agreement to offer the service inside the Store to US Merchants. And have currently an interface for IP enabled Terminals to offer this service in 24 States with a Magnetic Stripped Driver’s License.

    Interchange Fees represent one of the fastest rising costs for many US Merchants. And until now the Card Associations have owned the Cash Flow of many US Merchants. Now with a self funded Reward or Frequency Program US Merchants can take their cash flow back, while offering their customers Discounts, Points, or some other benefits. While Eliminating the discount rate of 2% or more.

    Last year according to the National Association of Convenience Stores Interchanges fees surpassed Gross Profit per stores for the first time ever.

    Randall Shake
    CEO
    ACH PAY LLC

  2. Jeff Paul Internet Millions Says:
    March 6th, 2009 at 12:53 pm

    Thanks! Now that I got to know more about internet marketing, I am now joining the great global competition. Wish me luck!