Infineon Technologies AG has introduced two new secured prepaid tag solutions designed to enhance the security of gift cards and mitigate consumer losses due to fraud, which the U.
S. Federal Trade Commission reports to be $1 billion annually.
The use of prepaid gift cards continues to expand, with a projected compound annual growth rate (CAGR) of 9% by June 2025, according to Allied Market Research. Despite this growth, consumers in the U.
S. are experiencing approximately $1 billion USD in losses annually from tampered gift cards, as reported by the U.
S. Federal Trade Commission (FTC). The FTC further indicates that roughly 25% of all fraud reports are related to gift card fraud, and 34% of U.
S. adults have been targeted by such scams. Merchants face substantial operational costs, estimated at four dollars for every dollar lost to gift card fraud, according to Chargebacks911 in July 2025.
In response to these challenges, Infineon Technologies AG, a global semiconductor leader, has developed new secured prepaid tag solutions for both open loop and closed loop gift cards. These solutions replace traditional visible codes, barcodes, or magnetic stripes with a secured chip that employs cryptographic mechanisms. The chip is accessible via NFC (near-field communication) devices, allowing consumers to use an authenticated phone to “tap” the gift card for activation, balance checks, and redemption. The secured EMV prepaid tag solution targets open loop gift cards for tap-and-pay functionality at various point-of-sale (POS) merchants and retail outlets, while the secured prepaid tag solution is intended for closed loop cards within retailer-specific environments.
Tolgahan Yildiz, Head of the Trusted Mobile Connectivity and Transactions Product Line at Infineon Technologies AG, stated, “Gift card scams include sales of expired cards previously tampered with by bad actors, theft by fraudsters who trick consumers into revealing gift card ID information and sophisticated social engineering techniques used to trick consumers into ‘buying’ cards and revealing the data needed to use them. Our secured prepaid tag solutions make this kind of theft and asset drainage ineffective by securing all usable information on a well-protected chip, accessible only to issuers, retailers and the valid holders of the gift cards.”
Infineon’s ecosystem partner for these solutions is Karta Gift Card Ltd., a provider specializing in secured access and processing capabilities for retailer-issued prepaid gift cards. Karta supports AES encryption protocols and processing for both of Infineon’s new solutions, offering cryptographic validation with every tap to facilitate adoption by gift card retailers. This collaboration aims to enhance every gift card transaction with secured dynamic NFC tags and cryptographic intelligence to prevent cloning, skimming, and replay attacks.
David Anderson, Co-founder and Co-CEO of Karta Gift Cards, commented, “By combining Karta’s real-time cryptographic validation technology with Infineon‘s advanced secure NFC chip solutions, we’re setting a new benchmark for prepaid gift card security. Leveraging AES-based encryption and dynamic authentication with every tap, this collaboration delivers end-to-end protection against gift card draining and scams.”
The secured prepaid tag solution for closed loop gift cards is compatible with existing manufacturing infrastructures for smart cards and paper tickets. The secured EMV prepaid tag solution is EMV compatible and supports the latest approved Visa and Mastercard applets. Both secured prepaid tag families are available immediately. This announcement was made prior to Money 20/20.
