Confused by Chip Credit Cards ?

[humble3d]

Confused by Chip Credit Cards ?

 

Get in Line

 

You’re at the checkout counter. Your items have been bagged. Your credit card is in your hand.

 

Do you swipe it or insert it?

 

The question has become vexing enough in the United States that a plea from one Twitter user for the country to “get on the same page” has become the unofficial, albeit vulgar, mantra of the nation’s consumers, with tens of thousands of retweets and likes.

 

Ten months into the transition to chip cards, it’s clear there’s no going back. But as the national frustration grows, here are answers to some burning questions.

Is It Going to Get Any Better?

 

There is reason to hope.

 

About 75 percent of credit cards are chip-enabled. If all businesses upgraded their terminals — which they are not required to do by law — at least the confusion over whether to swipe or insert would be settled.

 

So far, about one-quarter of the nation’s merchants have made the transition, said Jason Oxman, chief executive of Electronic Transactions Association, a trade group for companies that deal with payment products and services.

 

But while many of them have the terminals, they are waiting to get them certified for use, said Jared Drieling, the business intelligence manager for the Strawhecker Group, a consulting company for the industry.

 

Why Do Transactions Take So Long?

 

Technological improvements generally make things easier, but that’s not what this change is about.

 

The longer wait times at checkout occur because of all these steps in the process:

 

• The chip creates a one-time code.

• The payment terminal sends it to the bank.

• The bank matches it to an identical one-time code.

• The bank then sends back verification.

 

Voilà!

 

The good news: New software is being developed to allow chip cards to be inserted and quickly removed, speeding up the process, Mr. Drieling said.

What Was This Change About, Then?

Security.

“You can’t counterfeit a chip card,” Mr. Oxman said. “You can very easily counterfeit a strip card.”

Financial institutions changed the rules attached to their terminals last year. Now, if a counterfeit card is used because a merchant doesn’t have the technology to process chip-enabled cards, the merchant is responsible for paying the fraudulent charges.

Businesses that sell goods, like electronics, that can be easily resold on the black market are often targeted by people with fraudulent cards. Because of that, they have a lot of motivation to upgrade. If they don’t, they must pay the bill for all those purchases.

“But the local coffee shop might not be getting a lot of fraud activity,” Mr. Oxman said, so there’s less motivation to get the new terminals.

There is a chance, then, that at the onset of a purchase, you’ll never really know whether to swipe or dip.

 

Get used to it.

 

“The loud, annoying beep that you’re referring to is to remind you to take the card out,” Mr. Oxman said. “The goal of the noise is to get your attention, and it sounds like it’s working.”

 

But as Kathleen Dunn, 27, of Nashville pointed out, the sound rings of rejection.

 

“I hate the noise. It makes me feel like my card got declined, and I panic every time,” Ms. Dunn said via a message on Twitter.

Why Are So Many of the Machines Not Working?

 

Dieter Bohn, the executive editor of The Verge, a technology site, characterized the situation as a “checkout dance” in an article.

 

That dance is caused in part by the fact that many places that have the new terminals can’t use the chip reader technology yet. They’re not broken — they’re just waiting to be certified, and that process can sometimes take months.

 

Until then, retailers are responsible for any fraudulent charges, and they’re not happy about it.

Did Other Countries Have These Problems?

 

It’s likely, but their transition is long in the past now.

 

“We’re really one of the last G20 nations to adopt E.M.V.,” said Mr. Drieling, referring to the chip technology by an acronym for Europay, MasterCard and Visa, the technology’s early advocates.

 

The chips work a little differently in the 150 other countries using them: The cardholder also enters a PIN at the terminal, which lets the verification process happen offline, Mr. Oxman said.

 

Banks and retailers are at odds over why the United States isn’t adopting the PIN system.

 

Why it has taken so long to adopt the chip technology in the United States has a lot to do with its bigger and more complex market.

“Changing it is a huge undertaking,” Mr. Oxman said.

How Much Longer Will I Even Have to Carry a Credit Card?

 

Probably not much longer.

 

Most of the new terminals that accept the chip-enabled cards are also equipped with the technology to accept contactless payments, like Apple Pay or Android Pay.

 

http://www.nytimes.com/2016/08/06/business/chip-credit-cards-for-dummies.html?mabReward=A7&moduleDetail=recommendations-0&action=click&contentCollection=Personal%20Tech&region=Footer&module=WhatsNext&version=WhatsNext&contentID=WhatsNext&src=recg&pgtype=article

 

[Ballistic Gelatin]

And when the systems go down -- and periodically they will -- better have plenty of paper moola on hand.

[GRiM]

29 minutes ago, Ballistic Gelatin said:

And when the systems go down -- and periodically they will -- better have plenty of paper moola on hand.

 

 

lol.    UK got rid of swiping/singing and has been SOLELY chip/pin for over a DECADE.   It's extremely rare to ever have to pay with cash because of system going down. 

Contactless payments are now also widespread,  around 7/10 places (that have readers) accept it so paying with card, watch or phone takes couple of seconds and no faffing around with actually currency, swiping or signing anything.

Why it's taken US this long to catch up with payment processing is baffling to me to be honest.  Usually they're in front with tech.

[tiliarou]

Not just UK, the rest of the world pretty much got rid of swipe for more than a decade. Swipe is absolutely not secure, I can steal a card and make a dummy signature, and I can steal a card and steal the associated pin and pay but it's like 2FA, 2 things to steal is harder than one.

Contactless is super convenient but the least secure, there is absolutely no authentication: you have the physical card, you can pay.

I also don't understand why US is reluctant to let go swipe, honestly it cannot be for a time reason: swiping and signing is not faster than inserting and entering pin. And if your bank is not from the middle age (and the GPRS entwork has proper coverage), the transaction takes one second at the most...

[straycat19]

Everyone agrees that swipe is not secure, but in reality, it is more secure than contactless (NFC) payment systems such as Apple Pay or Android Pay.  Swipe requires that you have a physical card encoded with the correct information in order to process a transaction.  Contactless systems only require that you have the card information which is then entered into a phone to establish a contact pay capability.  This has become the preferred method of choice for card thieves since they only need the information they steal and don't need a device capable of producing/encoding a card.  Additionally, a couple hackers built a homemade device several years ago, that while walking down the street would transfer 1 cent from each apple pay enabled device they walked by.  The device fit in their pockets, cost less than $15 to build, and was untraceable.  On the other hand you can see hundreds of commercials for RFID protecting wallets for your credit cards when in reality there are very few RFID enabled credit cards in the world.  The names of these cards imply they have wireless payment capability, such as PayPass, Blink, PayWave, ExpressPay, and so on.  They also bear a tiny RFID/Contactless pay logo.

 

 

I don't know anyone who still uses contactless pay systems or even enables NFC on their phones since it has been proven to be very hackable.  We proved it at work when we 'stole' data off the director's phone using NFC.  I can't quote exactly what he said when we showed him but it was something like "!jdjf3w0oreyuewh#$I@UESesjddo!" if you get what I mean.  That was just before he disabled NFC and directed that all phones have it disabled.  I would say "security over all" but I think it sounds better in German "Sicherheit über alles".
 

[I4rg£8all8ag]

and no faffing around with actually currency, . Wow,  that takes all of a few seconds to pay with money FFS.