U.S. credit cards with microchips - it's happening!
Aug 5th, 2011, 06:37 PM
#22
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It's not just a decade late, it's multiple decades late.
The reason U.S. banks haven't done it is that it's not cost-effective. Banks actually care nothing about security; they care only about the bottom line. If the losses that they suffer with no security don't subtract from the bottom line as much as the cost of good security would, they'll skip the security. That's their analysis of chip and pin: it's more profitable to suffer the fraud and write it off than it would be to give everyone cards with chips and PINs.
Some institutions will improve security just as a matter of principle, but banks in particular, and U.S. banks especially, do not care about principles, they only care about profit.
The reason U.S. banks haven't done it is that it's not cost-effective. Banks actually care nothing about security; they care only about the bottom line. If the losses that they suffer with no security don't subtract from the bottom line as much as the cost of good security would, they'll skip the security. That's their analysis of chip and pin: it's more profitable to suffer the fraud and write it off than it would be to give everyone cards with chips and PINs.
Some institutions will improve security just as a matter of principle, but banks in particular, and U.S. banks especially, do not care about principles, they only care about profit.
Aug 5th, 2011, 06:51 PM
#23
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Anthony...the other justification you get from the banks is that fraud in the USA is not that big an issue as much as it was in Europe so there's no need to do anything about it and it's more profitable as yo note to eat the fraud losses than pay the money necessary to convert the whole payment system. I think everybody gets that and as a matter of fact, their logic is not all that bad on this. However...
1. as we've noted it's not necessary to convert the entire payment system in the US. Simply give customers the option of requesting a chip and pin credit card at the cost it is to the bank, probably about a dime. If they want to charge a quarter and make a profit on that, I can live with that. (You might be interested to know that all chip and pin cards issued still have magnetic strips on them for use in backward countries such as the USA. However many Europeans when coming here are unable to fill their rental cars withour cheap petrol because they don't have a zip code to enter at the pump, our idea of security. Of course, there are few gas stations in the USA which are not manned and they can always go inside to pay the bill but we won't tell anybody that.)
However, there is talk in the eu of allowing banks and merchants to have the option of refusing any credit card that is not chip and pin. I hope that happens and we'll see just what the US banks have to say then when their customers will be totally out of luck; right now the situation for the most part is manageable but as the song goes, "The times they are a changing."
1. as we've noted it's not necessary to convert the entire payment system in the US. Simply give customers the option of requesting a chip and pin credit card at the cost it is to the bank, probably about a dime. If they want to charge a quarter and make a profit on that, I can live with that. (You might be interested to know that all chip and pin cards issued still have magnetic strips on them for use in backward countries such as the USA. However many Europeans when coming here are unable to fill their rental cars withour cheap petrol because they don't have a zip code to enter at the pump, our idea of security. Of course, there are few gas stations in the USA which are not manned and they can always go inside to pay the bill but we won't tell anybody that.)
However, there is talk in the eu of allowing banks and merchants to have the option of refusing any credit card that is not chip and pin. I hope that happens and we'll see just what the US banks have to say then when their customers will be totally out of luck; right now the situation for the most part is manageable but as the song goes, "The times they are a changing."
Aug 6th, 2011, 12:46 AM
#24
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Well, right now, American tourists are prime targets for theft of credit cards in Europe because their cards can be used without a PIN, just by forging a signature (or by not bothering with a signature at all). So American banks make their customers more vulnerable to pickpockets and theft while abroad. But banks never have the best interests of their customers in mind, anyway.
Aug 6th, 2011, 03:30 AM
#25
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I don't think it's that simple as just giving the customer the option, all terminals at places that took credit cards in the US would have to change, wouldn't they.
It is possible the banks and CC companies know what they are doing, I suppose. Perhaps they don't think it makes economic sense for them. I wouldn't presume there is really no reason and everybody running all these companies is dumber than posters on Fodors.
I don't see that any of these cards mentioned are free, they all seem expensive and have fees for getting them. That Chase credit card isn't free, either.
Since I don't have one, how do you do online purchases with chip and pin cards? If it's the same as other cards (just typing in numbers), I would think that might be a big source of CC fraud and it wouldn't change that. But I really don't know how much fraud is due to people using CCs with people who don't check signatures. I know most places don't check signatures when I use them.
It is possible the banks and CC companies know what they are doing, I suppose. Perhaps they don't think it makes economic sense for them. I wouldn't presume there is really no reason and everybody running all these companies is dumber than posters on Fodors.
I don't see that any of these cards mentioned are free, they all seem expensive and have fees for getting them. That Chase credit card isn't free, either.
Since I don't have one, how do you do online purchases with chip and pin cards? If it's the same as other cards (just typing in numbers), I would think that might be a big source of CC fraud and it wouldn't change that. But I really don't know how much fraud is due to people using CCs with people who don't check signatures. I know most places don't check signatures when I use them.
Aug 6th, 2011, 03:59 AM
#26
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Christina...you do make some good points regarding the internet and things like that but understand that all chip and pin cards have magnetic strips for use in backward countries such as the United States and yes chip and pin does not cut down on fraud over the internet.
However, as I said, there would be no need to change all the terminals in the country if people were gtiven the option of getting a chip and pin card. In those merchants here who don't change their terminals, you would still be able to use the magnetic strip on the cards during a transition period.
Look, what it comes down to is a certain degree of American arrogance and refusal to join the rest of the world in so many different ways. 99% of the civilized world has converted to Celsius for temperatures, why does the US insist on keeping the illogical farenheit scale. Surely there is something to be said for an American travelling in Canada when told it is 15 degrees knowing how to dress, wouldn't you agree? And why do we have to teach our kids there are 5,280 feet which is 1,760 yards in a mile and then have them sit and laboriously change 8 miles to feet. Isn't it easier on them to teach them there are 1000 meters in a kilometer and to change 12 kilometers to meters, simply move the decimal point three places right. Wouldn't that allow them to enjoy math even more?
Or of course the biggest ludicrosity of all. Every year, study after study comes out showing how much money the US Treasury is losing by continuing to print $1 (and $2 although nobody uses them) bills. While it wouldn't solve the national debt, it certainly would help to substitute a nice looking $1 and $2 coin much as our Canadian friends have done for the last 15 years with the loonie and twonie; of course the Canadian dollar today is worth more than the US dollar, but why let that annoy us (and no, using coins for puny amounts such as $1 is not the reason why)....it's almost as if the USA has this degree of arrogance you know it's our way or the highway. And I'll stay away from controversial topics such as medical care but life expectgncy rates are somewhat higher in Canada where they have access to great medicine and drugs (trhe same drugs as a matter of fact) as we do in the USA. Draw your own conclusions on this.
It's symbolic. There are certan advantages to chip and pin. For example, a major source of credit card fraud is when you are in a restaurant and wish to pay for a meal with a credit card, they take the card into some back room usually and heaven knows what happens while they run the charge slip. Of course most merchants are honest and nothing happens but I've had my credit card number stolen two or three times and it could only have happened at a restaurant where the card was out of my sight. With chip and pin, they bring the terminal right to the table and insert the card while you watch with your very eyes (they eeven do it with magnetic strip cards; I love for example in Wagamama where they bring the terminal to the table and after swiping the card, hand you the terminal to enter the tip). Why don't we require restaurants in the USA to have these portable terminals to prevent fraud? Because we didn't invent them?
The world in many respects is passing the USA by and we continue to live in our own little cocoon of how everything is best here. Lots of things are best here, I don't arguye that, but there are things we can learn from the way things are done elsewhere. And the day is coming when American credit cdards will not be taken in places that have gone chip and pin. It may not be tomorrow. Why continue to fight a battle trhat has been lost?
However, as I said, there would be no need to change all the terminals in the country if people were gtiven the option of getting a chip and pin card. In those merchants here who don't change their terminals, you would still be able to use the magnetic strip on the cards during a transition period.
Look, what it comes down to is a certain degree of American arrogance and refusal to join the rest of the world in so many different ways. 99% of the civilized world has converted to Celsius for temperatures, why does the US insist on keeping the illogical farenheit scale. Surely there is something to be said for an American travelling in Canada when told it is 15 degrees knowing how to dress, wouldn't you agree? And why do we have to teach our kids there are 5,280 feet which is 1,760 yards in a mile and then have them sit and laboriously change 8 miles to feet. Isn't it easier on them to teach them there are 1000 meters in a kilometer and to change 12 kilometers to meters, simply move the decimal point three places right. Wouldn't that allow them to enjoy math even more?
Or of course the biggest ludicrosity of all. Every year, study after study comes out showing how much money the US Treasury is losing by continuing to print $1 (and $2 although nobody uses them) bills. While it wouldn't solve the national debt, it certainly would help to substitute a nice looking $1 and $2 coin much as our Canadian friends have done for the last 15 years with the loonie and twonie; of course the Canadian dollar today is worth more than the US dollar, but why let that annoy us (and no, using coins for puny amounts such as $1 is not the reason why)....it's almost as if the USA has this degree of arrogance you know it's our way or the highway. And I'll stay away from controversial topics such as medical care but life expectgncy rates are somewhat higher in Canada where they have access to great medicine and drugs (trhe same drugs as a matter of fact) as we do in the USA. Draw your own conclusions on this.
It's symbolic. There are certan advantages to chip and pin. For example, a major source of credit card fraud is when you are in a restaurant and wish to pay for a meal with a credit card, they take the card into some back room usually and heaven knows what happens while they run the charge slip. Of course most merchants are honest and nothing happens but I've had my credit card number stolen two or three times and it could only have happened at a restaurant where the card was out of my sight. With chip and pin, they bring the terminal right to the table and insert the card while you watch with your very eyes (they eeven do it with magnetic strip cards; I love for example in Wagamama where they bring the terminal to the table and after swiping the card, hand you the terminal to enter the tip). Why don't we require restaurants in the USA to have these portable terminals to prevent fraud? Because we didn't invent them?
The world in many respects is passing the USA by and we continue to live in our own little cocoon of how everything is best here. Lots of things are best here, I don't arguye that, but there are things we can learn from the way things are done elsewhere. And the day is coming when American credit cdards will not be taken in places that have gone chip and pin. It may not be tomorrow. Why continue to fight a battle trhat has been lost?
Aug 6th, 2011, 09:41 AM
#27
You make some good points, xyz123. Notably, it is incredible how the United States continues to cling to the dollar bill.
But thing about banks wanting to make money really floors me as well. It is not expensive to issue a chip card, even if the U.S. does not use them. Don't the U.S. banks understand that they will make heaps more money in commissions and conversions if people can use their cards more easily in the rest of the world?
But thing about banks wanting to make money really floors me as well. It is not expensive to issue a chip card, even if the U.S. does not use them. Don't the U.S. banks understand that they will make heaps more money in commissions and conversions if people can use their cards more easily in the rest of the world?
Aug 6th, 2011, 09:56 AM
#28
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kerouac...that's my whole point. It makes absolutely no sense and nobody can explain the reluctance at the very least to make chip and pin credit cards available to those who travel outside the country at cost (a quarter?)...and now the latest idiocy namely for Chase, Wells Fargo and US Bank to brag how they are finally issuing an EMV card (a chip card) but not chip and pin but chip and signature which will not work at the same places non chip cards don't work today and some people who have these cards report this on other forums. Frankly, it simply doesn't make any sense. Maybe somebody here can explain it. Yes I understand it would be costly to convert the entire payment system; I get that. But nobody is asking for that. Just join the 21st century which will benefit yur customers and get over this arrogancde that everything here is better. There are lots of things that aren't and chip and pin cards while possible not that overwhelmingly important a thing is one of them.
