By the end of 2015, 70 percent of U.S. credit cards and 41 percent of U.S. debit cards will have security chips.
While Europe, Canada and Mexico have had chipped cards for years (usually with a chip and a PIN), the U.S. card issuers have studiously avoided the more secure, but more expensive, cards.
Anyway, as other countries went to chip and PIN cards and the U.S. continued to rely on a less secure magnetic stripe, the predictable occurred. Just as having two loud German shepherds makes it likely thieves will move to the house next door, America’s continued reliance on mag stripes has made it an attractive target for card fraud.
“The fraud rate has doubled from 5 basis points to 10 basis points now,” said Julie Conroy research director in retail banking at Aité Group. “We are going to have all these different permutation of transactions at point of sales (POS). Some will be EMV-enabled with EMV terminals, some terminals will be ready and some cards will have fraud assessment challenges. It will be a big task for issuers and you can be sure fraudsters are aware of it and will prepare attacks”.
