We sometimes hear about microchips under human skin. Even though most people find this idea scary, the army of RFID (Radio Frequency Identification) and NFC (Near Field Communication) chips fans are steadily growing. The Wall Street Journal reports (1) that “there is no comprehensive data on how many people have RFID implants in their bodies, but retailers estimate the total is 30,000 to 50,000 people globally.”

Those, who get the chips implanted, believe that these devices can elevate humanity to a new level. For example, management of the Swedish company Epicenter has implanted chips in the company’s employees’ hands. 150 people agreed to this voluntarily. Epicenter’s CEO Patrick Mesterton explains that these tiny devices replaced keys and swipe cards. The chips also control computers and printers. Fredric Kaijser, the 47-year-old chief experience officer at Epicenter, commented (2) his adventurous decision: “For me it’s just a matter of I like to try new things and just see it as more of an enabler and what that would bring into the future.”

However, the ability to open the door and operate the printer with just a wave of the hand is not the big deal: chips must offer something more – for example, the ability to use them as a bank card.

A wallet under your skin

The term “cashless society” is now in vogue. Every year, fintech companies present new solutions, and developers already offer to use chips instead of bank cards. Does this mean that we already have a cashless society under our skin in the most literal sense?

Modern technologies are not capable of providing a sufficient level of encryption for full-scale use of implantable microchips as bank cards. However, insertable technology expert Kayla Heffernan is convinced that this is just a matter of time. He says (3) : “Payments are the killer application. As soon as you can pay with it, more and more people will go ahead and get these.”

Well, maybe he is right. People have already rejoiced at contactless payment technologies: Barclaycard’s Contactless Spending Index (4) reports that the value of mobile phone-based touch-and-go payments using its bPay payments chip, which is embedded in items such as watches and jewelry, increased by 365% in 2017 compared to 2016. Over the same period, mobile phone-based contactless payments using its Android app saw a 129% increase in the value transacted.

Stunning numbers, right? It can be assumed that implantable payment chips will gain a comparable success after the necessary technology is developed and, more importantly, if the public starts to perceive the chips more favorably. By the way, there’s a wrinkle with the last point. Many even most tech-savvy users are not ready to have something put under their skin yet.

Cashless utopia? Not now

People are mainly concerned about security and confidentiality. This unusual technology looks frightening, mainly because of the possibility of easy hacking and potential surveillance. Cybercrime rate (5) in the world is not going to decline. However, as strange as it may seem, these problems have no relation to RFID and other available kinds of implantable chips – at least, for now.

The thing is that you can’t be tracked if you have a microchip embedded in your hand. The technology is not quite developed yet, so data transmission is possible only at a short distance, and you can’t integrate GPS into the chip. Medical use of the technology is also quite restricted, and it is impossible to monitor heart rate or blood alcohol content. Apparently, Big Brother has to be content with just snooping on our smartphones.

These same principles protect the owners of the chips from petty thieves. They can steal a bank card, but they are unlikely to chop off your hand to get your chip. Your bank account is much easier to hack.

The real problems lay elsewhere, and if we have already started comparing chips with non-cash payments, then it would make sense to consider these two technologies together. After all, a cashless economy once seemed to be some kind of utopia, too. So, what are the real threats that we can face?

1. Contactless payments and microchips are based on RFID and NFC technologies. Both are not quite protected from particular kinds of hacker attacks. Paris Kitsos, an assistant professor at Technological Educational Institute of Western Greece (6), explains in his Security in RFID and Sensor Networks book: “RFID systems are still vulnerable to attacks related to location verification. Such attacks work on the physical layer and therefore cannot be prevented by any kind of security protocols that operate in the higher layers of the protocol stack.”

This is confirmed in practice. Since PayPass and PayWave technologies were installed, the Australian Herald Sun (7) revealed, the number of deception offences has skyrocketed. In Victoria alone, there have been 1000 more offences every month.

2. When we rely on cashless payment technologies (including chips), we are potentially depriving ourselves of freedom of choice. With respect to chips, the problem lies in their incompatibility with varying types of devices: for example, if city bus lines and the subway accept different chips, then the person will have to choose what to use.

Same is with non-cash payments. A couple of years ago the government of Australia introduced (8) so-called cashless welfare cards to prevent gambling and alcohol and drug abuse among the poor. The card is accepted only in authorized stores, which aren’t always the best choice for a customer. Such an obvious attempt to limit freedom of choice was met with indignation, which keeps flaming up to this day.

3. Any technology carries a risk of a failure. If we store all means of subsistence in electronic form (be it a bank card or microchip), we put them at risk. Messages about denied bank cards are rare, but there’s no guarantee that you are not the next victim. In addition, both a bank card and a microchip are just means of identification. Data on your account and the money itself is stored in your bank, which is not completely immune to a leak of the customer database and hacker attacks. Juniper Research estimates (9) that the cost of data breaches will rise to $2.1 trillion globally by 2019, increasing to almost four times the estimated cost of breaches in 2015.

Launching bank cards into mass circulation and offering implantable microchips to users, fintech companies let the genie from the bottle. Like any technology, non-cash payments are not intrinsically bad – the whole point is how wisely we use them. We still cannot fully cope with all the shortcomings of the system, and maybe we don’t have to rush headlong into a not-so-bright cashless future. You can’t escape progress, but it’s better to keep a bunch of cash in your wallet just in case.

1) https://www.wsj.com/articles/when-information-storage-gets-under-your-skin-1474251062
2) https://www.cnbc.com/2017/04/03/start-up-epicenter-implants-employees-with-microchips.html
3) https://www.theguardian.com/technology/2017/nov/01/under-the-skin-how-insertable-microchips-could-unlock-the-future
4) http://www.computerweekly.com/news/252436100/Wearables-join-mobiles-as-high-growth-payment-methods
5) https://www.aspistrategist.org.au/time-admit-failing-cybercrime/
6) https://books.google.ru/books?id=lPEwic6W1RgC&lpg=PA155&ots=v16oVzQaYS&dq=Mafia%20Fraud%20Attack%20rfid&hl=ru&pg=PA155#v=onepage&q&f=false
7) http://www.news.com.au/finance/business/retail/police-say-deception-offences-have-increased-since-tapandgo-technology-was-installed/news-story/268eb1ad4bc5a91edb05f84f937afc03
8) https://www.theguardian.com/australia-news/2017/jan/09/ration-days-again-cashless-welfare-card-ignites-shame
9) https:\www.juniperresearch.com\press\press-releases\cybercrime-cost-businesses-over-2trillion

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