When Target’s data was stolen, subsequently unleashing the credit and debit card information of 40 million store customers right during the holiday season, it inadvertently highlighted a growing problem: the outdated credit card technology America is still reliant on.
The Problem With Reliance on Outdated Technology
Many Americans might be surprised to learn that the “swipe and sign” model is fairly outdated, with most other parts of the developed world instead using EMV technology– cards that use a computer chip and PIN number. These debit and credit cards allow a unique verification code to generate each time, making it difficult to re-create cards using stolen information.
U.S. Adoption Isn’t Slated for Two More Years
Although this technology has been around now for decades, the U.S. won’t be adopting it until 2015. The main problem has been price. When the switch is made, it will involve massive re-modification of company payment terminals across the country. Not only will all cards need to be re-issued, but ATMs and gas pumps will need to be upgraded. Until the two year waiting period is up, it is likely that we will see more company vulnerabilities exposed, and customer data exploited, as the technology available to thieves outraces security technology for the outdated card model.
The Future of Merchant Card Services
According to Yahoo Finance, once the October 2015 deadline the credit card companies have set, passes, businesses will likely become stuck with any losses owing to fraudulent sales. It’s also possible that mobile phones, as they become increasingly ubiquitous to the consumer experience, might eventually replace plastic cards as the most common payment device. Companies will need to pay attention to these changes so that they don’t fall behind, or end up like Target, who is already facing three class-action lawsuits following the breach, with more likely to follow.
How secure do you think your debit and credit card payment processing is? Let us know in the comments.