April 30, 2014
It looks like it took the hacking of 40 million credit and debit cards of Target customers to push one of the country’s largest retailers to implement safer technology for payments.
Target announced that it plans to start having the option of a chip-based credit card technology, a safer alternative to the magnetic stripes used in the United States. The retailer will have chip-and-PIN terminals available on 1,800 stores by September of this year.
Credit Card stripes are easy for thieves to duplicate, and the use of a PIN to verify identity makes cards more secure.
According to research on reducing fraud, “Chip-embedded cards support dynamic authentication whereas data on mag stripe cards is static. Thus, data from traditional mag stripe cards can be easily copied (skimmed) with a simple and inexpensive card reading device.”
Europeans have used this method of payments for years (France started using chip-and-PIN in 1992) to secure users from theft and even hacking.
To some, this may seem like an aggressive push, but Target is just ahead of the game. MasterCard and Visa have set an October 2015 deadline to roll out the chip-and-PIN technology in America. Merchants who don’t comply will be responsible for the costs of the transactions made with stolen cards.
Target’s CFO John Mulligan recently testified to the Senate Judiciary Committee where he confirm hackers had slipped malware into their point-of-sale network, affecting all card terminals in US stores.
This is a big move on Target and it will most likely come with initial issues brought by new technology endeavors. However, this is a necessary step to safeguard customer’s information.
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