'Worthless' new Credit Cards with Chips.

[Geek-9pm]

Major sources s blast the new credit cards in the USA.

NBC:  Credit Card Switch Bites Subscription Services

Lifehacker: New Chip Credit Cards t Interrupt Your Automatic  Payment

Today :'Pretty useless': Consumer frustrations

I doubt I will get one. 

[BC_Programmer]

Welcome to the transition period that pretty much all other Western nations went through years ago 


It is still a bit weird to hear about issues with "new technology" when that new technology is something that you have been using for years. It has to have been over 5 years ago that I got my first Bank Card that had a chip in it- it used a dual chip and magnetic stripe, so it had both. Later I got a card with only a chip- the area where the stripe would be is merely colored green on the plastic.

Most of the issues outlined there were the same issues we had here in Canada during the transition, and presumably other countries that have moved over to chips, as well. It is mentioned in a quotation that the technology is useless because it merely tells you to swipe the magnetic strip. I had that happen. (over 5 years ago... *cough*) It is almost certainly something technical involving standards compliance for the POS devices- perhaps they've passed certification for the swipe but need to be reevaluated for the chip reader, or something.

I cannot think of any disadvantages of the chip approach in terms of usability at this point. Most POS devices I've seen no longer even have a stripe reader. And I don't recall having to try more than once to get it to work. The advantages in security would be worth a minor inconvenience anyway, I think.

[Geek-9pm]

Glad to hear it works for you.
There is a lot of criticism about how it is implemented here in the USA.
For one, The new system here in the USA does NOT use a PIN. Some experts think this is a fatal flaw in the new system. If  you lose your card, somebody else could use it.

Real life example: Shopper opens her purse   and removes some cards. One cord falls into a very small crack in the POS counter top. It store employees can not open the counter until later. Then when the shoppe comes back later they tell her it was not found. (The really did happen here recently to two Walmart shoppers.) 

[BC_Programmer]

I don't think we use PIN here, either, at least not for Credit Cards. since my Bank Card is both a Debit/Interac as well as a Visa. I'm fairly certain it get's used as a Debit card for Point-Of-Sale, though. Transactions that were done through the "Credit Card" capability start with __V (presumably an indicator that it used my card as a Visa) and those transactions have not required a PIN entry. I don't know what a "real" Credit Card would do for Point Of Sale, though.

If the U.S system intends to do away with the Debit PIN entry, I'd say that is a flawed approach, because unlike Credit Cards the cardholder has far more liability. Part of that liability involves keeping the PIN secure- if that PIN is suddenly not needed, that is a rather big issue because of the added consumer liability, IMO. I highly doubt that is the case- as I understand it the U.S uses a different Debit system so the rollout for actual Debit cards is going a lot slower

It was my understanding that currently U.S CC's are "pinless" in general, and above a certain dollar amount you have to sign for it, but otherwise they don't use any sort of PIN, or many security features at all- anybody in possession of the card can make use of it. Is this incorrect?

Shopper opens her purse   and removes some cards. One cord falls into a very small crack in the POS counter top. It store employees can not open the counter until later. Then when the shoppe comes back later they tell her it was not found. (The really did happen here recently to two Walmart shoppers.)

But how would this situation be any different using the old approach? Again, my understanding of the current magnetic swipe Credit Card is the cardholder signs the receipt if it is over a certain dollar amount. Any "checks" here would depend on the clerk's studiousness, whether the cardholder had signed the back of the card, wether the clerk bothers to look at it, etc. The majority of the time I don't think anybody bothers. So the situation is the same. But in both scenarios, there isn't a huge issue- once you lose a card, you report it lost or stolen and you are not liable for any uses of the card that go through after that. (And usually in cases of fraud you aren't liable either).

[Geek-9pm]

In addition the to PIN question, there are some other tings about the system.

Credit card fraud is widespread. To what extent the consumer is protected has yet to be proven.

Herb Weisbaum , ConsumerMan for msnbc.com contributor has some  a long rank about how hackers  criminals could steal a lot of cash  from your ATM  account and get away underacted. I will not repeat what he sad, but he claims the crooks already do it and the new chip does not stop them.
This is link to his site.
http://www.consumerman.com/
He says:

The shift to chip cards is an important step in combating fraud, but experts agree that chip cards are not going to make card fraud go away. Fraudsters will still try to make money by stealing card data, and you’ll still need to protect yourself by taking some basic precautions:
    Check your accounts for unauthorized charges or debits regularly. Sometimes fraudsters will process a small debit or charge against your account and return to add more charges if the first transaction goes through. If you have online or mobile access to your accounts, check your transactions regularly. If you receive paper statements, be sure to open them and review them closely.
    Report a suspicious charge or debit immediately. Contact your bank or card provider immediately if you suspect an unauthorized debit or charge. If a thief charges items to your account, you should cancel the card and have it replaced before more transactions come through. Even if you’re not sure that PIN information was taken, consider changing your PIN just to be on the safe side.

Many consumers will still be using the PIN for some time.

[BC_Programmer]

To what extent the consumer is protected has yet to be proven.

The "extent the consumer is protected" is described in the documents we receive from the bank/Credit Card company. The ones that list their liability and the consumer's liability.

Herb Weisbaum , ConsumerMan for msnbc.com contributor has some  a long rant about how hackers  criminals could steal a lot of cash  from your ATM  account and get away underacted.

And the liability would be with the credit card company, the responsible merchants, or the bank. Unless the United States has far more ridiculous contractual obligations between the bank and account holders than I thought.

[camerongray]

Yet another set of articles freaking out because something changed.  We've had chip (and PIN) based cards in the UK for for over 9 years now and they are so much more secure than magnetic stripes - A magnetic stripe can be easily cloned, a chip can't be.

It's a bit ridiculous that the US system won't use PINs since that is one of the great things about the chip technologiy.

[DaveLembke]

It's a bit ridiculous that the US system won't use PINs since that is one of the great things about the chip technologiy.

The only sort of pin we have to use is with online purchases where they request the 3 or 4 digit pin on the back of your card. Im really surprised that they havent gone the route of the digital electrnic authenticator keys such as those that PayPal and Blizzard use to secure account access where a 6 digit key code is always changing at timed intervals + a pin required by you which is usually the password that goes along with their use. You would need physical access to the card device to generate the authenticator code + know what the password/passcode pin is to use it. Only drawback to this is that the merchants cant sit on a number and process it later as well as they wouldnt be able to store your payment info as for the next purchase you make would also require the device to spit out the key code.

[Salmon Trout]

Yet another set of articles freaking out because something changed.

God forbid they should ever adopt the metric system.

[SuperDave]

I've been using my cards with chips for quite some time with no problems but I still have to enter my PIN. A card without a pin is just like cash.

God forbid they should ever adopt the metric system.

They already have but they don't realize it. All medical professionls use it as well as the military.

[Salmon Trout]

I've been using my cards with chips for quite some time with no problems but I still have to enter my PIN. A card without a pin is just like cash.They already have but they don't realize it. All medical professionls use it as well as the military.

The US "Customary" (don't say Imperial!) units have been derived from the metric system since the 19th century. 1 yard was 3600/3937 metres from 1893 to 1959 when it was defined by international agreement as (exactly) 0.9144 metres.