Credit cards without chip? I’m sorry, we don’t accept it…

chipand chipIn a recent article in the New York Times, Americans have problems getting their credit card accepted when travelling outside US. Countries around the world are changing to EMV technology (chip on your credit card), to combat the rising numbers in credit card fraud. This results in that merchants not anymore accepts credit cards without chip in the POS-terminal.

Many merchants simply ignores credit cards without chip, it’s not worth the cost and risk for them to accept a credit card without chip. This causes service disruption and irritation for the user to see their cards not being accepted in a POS-terminal.

Europe is entering the Single European Payment Arena, which intend to broaden the acceptance of cards. The intention is  to increase acceptance, but credit card without chip will likely be more rejected. All European cards will soon have the advanced version of the EMV-chip (DDA), which means that the POS-terminals can cryptographically verify that the chip is genuine, without having to contact the issuing bank. This means that merchants will have lower risk, and therefore will be able to accept the card in new places like vending machines or car parks, which are often offline or semi-offline, which might not be available today.

With the rise in skimmed cards around the world, and the US is one of the most common places where the bad guys are making their withdrawals, might call for a change. UK Payment Administration (former APACS), reported significant losses towards the US, eventually US banks will upgrade their ATM’s to prevent foreign card skimming, and put chip on cards that they know will travel.


~ by petergullberg on October 14, 2009.

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