JUNE 11, 2015 LAST UPDATED: THURSDAY, JUNE 11, 2015, 1:21 AM
BY KEN SWEET
THE ASSOCIATED PRESS |
WIRE SERVICE
NEW YORK — U.S. banks, tired of spending billions each year to pay back fleeced consumers, are in the process of replacing tens of millions of old magnetic strip credit and debit cards with new cards that are equipped with
computer chips that store account data more securely.
By autumn, millions of Americans will have made the switch from the old magnetic strip cards. That 50-year-old technology, replaced in most of world, lingers on the back of U.S. cards and is easily copied by thieves, leaving people vulnerable to fraud. Roughly half of all credit card fraud happens in the U.S., even though the country makes up roughly 25 percent of all credit card transactions, according to a report by Barclays put out last week.
About half of all U.S. credit and debit cards will be replaced by the end of the year. Tens of thousands of individual merchants need to upgrade their equipment to allow for “chip-and-sign” transactions instead of “swipe-and-sign” ones. If the stores aren’t ready, they could be on the hook to cover the cost of fraud.
How the new cards work and how the switch could affect consumers:
* What’s different about these cards?
https://www.northjersey.com/news/business/new-credit-cards-on-the-way-1.1353864
This is about time it should have happened several years ago.
It comes down to cost. There’s a huge cost in implementing this chip technology in cards. The point was reached where that cost had been surpassed by absorbing the cost of all the fraud.
Another option was to require the input of a 4-digit code after the credit card was swiped. However, market research showed that Americans did not want to remember a 4-digit code.
It should have happened TEN years ago.
Well the rest of the civilized world has only been using them for 15 odd years.
Who cares… now the criminals just break into the (relatively) unsecure financial institution’s computers and grab the data. And the low end criminals just buy RFID readers and swipe your info right off your credit card when they walk past you in the mall or at the gas station…
These chips are just an illusion of increased security.