In an effort to lower fake and charge card fraud more than 200 million payment cards have been provided with embedded computer chips in the U.S., ahead of a Oct. 1 deadline for the switch to such cards, according to the Smart Card Alliance.
Charge card companies have actually set the October due date which will certainly need U.S. consumers to bring a brand-new type of card and retailers across the nation to upgrade payment terminals.
Randy Vanderhook, executive director at the Smart Card Alliance which counts Visa Inc, MasterCard Inc, American Express Co and Discover Financial Solutions as its members told Reuters there are a lot more chip cards in the hands of customers than there are merchant places that are equipped to accept them.
“Many individuals have several cards in their wallet,” Vanderhook said.
“So even if people get one card in their wallet that’s their primary shopping card then it does not matter that there are still numerous thousands of other cards that have yet to be replaced.”
The Alliance expects to issue 600 million chip-enabled cards by 2015. The total number of payment cards in the united state stands at approximately 1.2 billion, which includes credit, debit, charge and other types of payment cards.
U.S. merchants are investing $8.65 billion for upgrading their payment terminals and some consisting of Target Corp are prepared to accept the new cards. It is not completely clear at the minute how many U.S. merchants have actually updated their payment terminals.
“Retailers are making a huge investment in order to upgrade their terminals to accept these cards,” stated Brian Dodge, executive vice president of the Retail Industry Leaders Association.
“However the level of security in these cards is not what it ought to be and it is not equal to exactly what is offered in the remainder of the world,” Dodge stated.
U.S. banks and card business will certainly not issue individual identification numbers (PINs) with the new credit cards, an added security step that would render taken or lost cards virtually ineffective when making in-person purchases at a retail outlet.
Instead, they will certainly stick with the present system of needing signatures.
Experts predict that charge card scams at brick-and-mortar sellers will fall after the intro of chip-enabled cards, however that online fraud will rise, as has taken place in other countries making use of the innovation.
Research study and consulting firm Aite Group estimates U.S. online card scams will more than double to $6.6 billion from $3.3 billion between 2015 and 2018.