The Bankwatch

Tracking the consumer evolution of financial services

US Banks payments jump from days of the Beatles all the way to 2005’ish for rest of the world

For non Americans the significance that it took the President to sign an Executive Order is large. An Executive Order is required for either inconsequential items, but more often those which cannot otherwise be agreed upon by the legislative Congress who are generally governed by lobby groups, and therefore cannot make a decision.

US Banks have been stuck in the past and refusing to buy into Chip Cards. They have even been balking at PIN rather than signature. This is the country with Miles and Gallons of course. Most wanted to stick with Chip and Signature, as indicated in this recent Forbes article, which to the rest of us is nonsensical.

So the President fell on the side of common sense, and pushed through what the banks deep inside know they actually want. This really only brings them to Europe and Canada in 2005’ish, but its a good step. Not sure how they will feel about Apple Pay which hits tomorrow (Oct 20th) but thats for another day.

Obama signs chip and PIN executive order

US president Barack Obama has signed an executive order mandating the use of chip and PIN technology at executive departments and agencies for card payments.

The president called on the private sector to up its game, commending those that have taken action, including breach victims Target and Home Depot, who are now rolling out chip and PIN. Earlier today, a trade body set up to push the migration from magstripes, estimated that nearly half of US merchant terminals will accept EMV chip card payments by the end of next year.

As Mathew Shay of NRF indicated, the current credit card technology in US dates back to the days of the Beatles. It also drives the matter that kills me where Canadian Banks insist on having a mag stripe on a chip card. The only reason is because we are beside America and the Marketing folks can’t get there mind around not having american access when Canadians shop across the border.

Why is credit card data so easy to steal?

Because the technology designed to keep consumers’ confidential information secure was developed at the same time the Beatles arrived in America, says Matthew Shay, CEO of the National Retail Federation.

“We’re using essentially an 8-track tape from the 1960s,” Shay said in an interview on CNBC in January.

For once, I will say, go Obama!

Written by Colin Henderson

October 20, 2014 at 00:18

Posted in Uncategorized

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