If you’ve gotten a new credit card in the past several months, it probably has little chip pressed into the plastic above the first four digits.
But whether or not you’ve been able to actually use that chip, which boosts the security of credit card transactions, is a different story. And according to a new report, retailers and other businesses that are supposed to start accepting the cards by the start of October might run behind.
Chipped cards, which are also known as EMV cards, already are the norm in Europe, Canada, and many other parts of the world. Visa and Mastercard have set a deadline for banks and businesses to start using the new cards by October 1. If banks haven’t gotten the new cards to their cardholders by that date, or if businesses are still using simple magnetic stripe card readers, they’ll be forced to bear the cost of any fraud that results.
Yet some 42 percent of technology decision-makers at businesses affected by the shift to EMV cards either say their company has made no progress or they don’t know what’s being done to get ready for the deadline, according to a survey by Randstad Technologies, a consulting business in Atlanta. And more than half of the 84 business leaders surveyed said they thought the October deadline should be pushed back.
Businesses aren’t the only ones running behind. According to a survey conducted last year by the Aite Group, a Boston-based consultancy, the banks that issue the most payment cards said some 30 percent of credit cards and 60 percent of debit cards wouldn’t be replaced with chipped cards by the October deadline.
Although the new liability rules imposed by Visa and Mastercard won’t affect consumers, who are protected by federal law if they report the fraud in a timely manner, advocacy groups have said that fraud caused by using normal credit cards can lead to frustration and fear.
Nor will chip cards be a silver bullet to stop all fraud; the cards can still be stolen, and a thief can forge a signature. And most online sellers don’t have any means of reading the chip on a physical credit card, and experts have called for alternative security measures to prevent fraudulent transactions.