Why Your New Chip Credit/Debit Card Isn’t Any Safer
October 1st is the date retailers have to completely switch over to chip-to-pin cards in a veiled effort to secure credit and debit cards.
Because the new system has been integrated into the old system, the new chipped cards do not make them any safer or protected from hacker attacks. The reason is because the new chipped cards must be run through a chipped-card payment terminal; otherwise the merchant is reading the magnetic stripe on the back of the card.
Statistically speaking, 1 in 4 retailers, or 27%, have switched their card payment terminals over which is not enough participation to guarantee customer protection, according to Strawhecker Group , a management consultant company.
The assumption by the credit industry was that 34% of retailers would be up to speed for the chip-to-pin switch over by the deadline. However, reality shows that by the end of 2015, retailers will be grossly under the 44% minimum participation and falling behind of the 90% participation expected by 2017.
Jason Brewer, spokesman for the Retail Industry Leaders Association (RILA) reassured consumers that their “credit cards will be accepted, whether they’re old or new” because of the minimal participation in the switch-over by merchants.
Visa has only issued chip-to-pin cards to an estimated 18% of the total customer base; while 1 in 5 banks have ordered chipped cards to replace current cards.
MasterCard accounts for 40% of the switch over.