Security system for EFT using magnetic strip cards

Abstract

Abstract Discretionary data encoded on a track of a magnetic strip card is used to improve the reliability of recovery of the card data and, when coupled with complementary processing in the EFT terminal, protects the PIN on an end to end basis (that is between the transaction terminal and the card issuer), as well as providing for end to end card authentication. An issuing bank encodes cards under the control of a number of encryption and encoding keys which are unique to the Issuer Identification Number (IIN). The result of this is an individual encryption key (Card Key CK) for each card which is derived from this key. The encoded Card Key (CK) which is stored in an encoded form within the track discretionary data is used as the basis of a key to firs encrypt the PIN. The Card Key is combined with transaction variables such as amount of the transaction to produce a unique PIN key for this transaction. The Card Key is not transmitted by the terminal to the controlling computer system. Thus both the encryption of the PIN and authentication of the card is protected from a compromised computer system connected to the transaction terminals.

Inventors

• 👤 Chris Reilly

Bibliographic Details