Congress requires SMARTCARD technology to be built into Visa/Mastercards
February 7, 2014 1:35 PM   Subscribe

In a meeting today, I was told that Congress will be requiring Visa/Mastercard and the various banks that provide Magnetic-Stripe debit and credit cards to their customers to upgrade their technology to cards that incorporate SMARTCARD technology, with unique card ID-numbers.

Where can I learn more about this technological advancement, it sound like a HUGE infrastructure upgrade!
posted by shipbreaker to Technology (15 answers total)
AFAIK this is standard in the UK and is known as Chip and PIN, but the generic version is known as EMV.
posted by bluecore at 1:37 PM on February 7, 2014 [2 favorites]

This is not new technology, it's been used in Europe for years. Here's a link to the Smart Card Alliance FAQ page, more than you probably want to know.
posted by mr vino at 1:39 PM on February 7, 2014 [2 favorites]

This sounds a lot like someone misunderstanding the requirements for EMV in 2015. I'm following this closely and haven't heard anything about a Congressional mandate. If you are a retailer and you do not implement EMV compliant processing by October of 2015, your business assumes all liability for fraud.
posted by bfranklin at 1:41 PM on February 7, 2014 [5 favorites]

As of a few years ago, Canadian banks issue their bank/debit/credit cards using this technology as well.
posted by SpecialSpaghettiBowl at 1:42 PM on February 7, 2014

shipbreaker: "it sound like a HUGE infrastructure upgrade!"

It can get phased in pretty smoothly. Banks send out replacement cards to customers that include the chip and new credit card payment terminals just get the chip-reader in addition to the mag-swipe reader. As shops and cycle their hardware, they get the chip and pin feature included and gradually everyone migrates over.

For a while you'll use the swipe reader at your local corner-shop and the chip n' pin at the bigger stores, but it'll all even out pretty quickly. The banks and shops save a lot of time and money with regards to dealing with disputed charges, so everyone with any sense will jump on it pretty damn quick.
posted by Static Vagabond at 2:32 PM on February 7, 2014

Not a Congressional mandate; instead it's a mandate from Visa/Mastercard/American Express.
posted by dcjd at 2:34 PM on February 7, 2014

bfranklin has the nut of it: In October of next year, whoever has the lowest level of tech in a transaction is liable for fraud: If a merchant only has the old swipe reader he's liable, but if the bank hasn't provided a smartcard to you, they're liable.
posted by Oktober at 3:17 PM on February 7, 2014

Where can I learn more about this technological advancement, it sound like a HUGE infrastructure upgrade!

No, it's not a new advancement - I read this morning that the US is the last major market that doesn't use this technology (and based on my travel experience, I believe it).

This isn't happening until October 2015, plenty of time for CC companies to reissue cards to their customers.

And finally, as dcjd notes, I am almost certain that this is not a Congressional mandate of any sort.
posted by schroedingersgirl at 4:08 PM on February 7, 2014

It came into Australia years ago and it wasn't really a huge upgrade all in one go as you are imagining.

Basically when your old bankcard expired, your new one had a chip. Gradually over a period of years shops replaced their swipe machines with ones that could read chips. I guess they probably did it as the old ones needed replacing anyway. The supermarkets were the first to do it, then it trickled down to the smaller shops. Even today, which I think must be at least seven or eight years after it started, I go into the occasional shop that only has swipe machines. Cards have both a chip and a magnetic swipe now, so you can still swipe them if you have to.
posted by lollusc at 7:21 PM on February 7, 2014

Two very recent NPR stories for background:

Dec 19th: Outdated Magnetic Strips: How U.S. Credit Card Security Lags

Jan 23rd: Target Hack A Tipping Point In Moving Away From Magnetic Stripes
posted by intermod at 8:27 PM on February 7, 2014

Cards have both a chip and a magnetic swipe now, so you can still swipe them if you have to.

It's worse than that, even. Bloody near impossible now to get an Australian card that doesn't have RFID connectivity as well as a contact-type chip and a magstripe.

I mean it's kind of cute just being able to tap my card on a reader plate and put it straight back in my wallet, but I'm still glad I took the time to line the card's compartment in my wallet with copper foil to short out the contacts (hopefully including the RFID antenna) while it's in there.
posted by flabdablet at 3:23 AM on February 8, 2014

Also: Chip-and-PIN vs. Chip-and-Signature
posted by RobotVoodooPower at 4:10 PM on February 8, 2014

Not new: I first encountered this technology when I moved to France (from the UK) in 1998. Chip-and-PIN reached the UK a few years later, and we now have the tap-cards flabdablet mentions above. It was phased in gradually and there was no big drama.
posted by altolinguistic at 4:26 AM on February 9, 2014

The person in your meeting perhaps read this Wall Street Journal article from February 6th.
posted by cashman at 8:44 AM on February 9, 2014

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