I wanted to create this article to discuss the security of our money as consumers and to address the title ‘should the U.S embrace Chip and PIN?’. As a U.K resident, I have used the Chip and PIN card machines in my day to day life so I have a firsthand perspective of how effective they are and whether they live up to the added security which was promised when the chip cards were first introduced in 2004.
I have tried to include appropriate illustrations so that readers can get a proper visual understanding of how this technology works, as you can see, a small electronic chip is embedded on the face of the card. The chip is 1cm x 1.5cm in size and is unique to each person, it stores information about their account and is then matched against a pin number that only they know.
I think this is a great way of tackling fraud, before this method was introduced I was always worried how easier it might be for someone to use my card by forging my signature if I was to lose my wallet by accident. I have not had any problems with suspicious activity on my debit card since the bank issued the new design to me in the post when my magnetic strip card expired, all I had to do was remember the 4 digit pin-code they sent me in a separate letter.
The U.S has concerns about adopting this payment system but are already partially involved by using the pin-code method, this is known as EMV(Europay Mastercard and Visa) where the 3 major card issuers work together to allow magnetic stripe cards to be swiped in countries where Chip and PIN is being used and chip cards can be verified by signature in the U.S.
The main problem that U.S banks have with Chip and PIN is that it would be very costly to equip all the retailers and merchants with the card terminals over their huge network. However, it has been suggested that they could still introduce the chip to cards which would be a small fraction of the cost and would avoid potential misunderstandings with customers wishing to pay abroad.
Although the a large amount of fraudulent activity happens online where Chip and PIN is in-effective, it would make sense to add the Chip and then roll out the card machines gradually helping tackling all criminal activity head on instead of avoiding this necessity.
