Posted on Friday, 11th June 2010 by Timothy Bell
Americans traveling or living abroad are finding it increasingly difficult to use credit and debit cards overseas. Europe, Australia, Latin America and a large percentage of Asia, India, China, Mexico and Canada have accepted and implimented the more secure Chip-and-PIN system. While the U.S. continues to use less secure magstripe cards, credit cards using Chip-and-PIN will have a encrypted computer chip embedded in the card that contains the consumer’s personal identification information. When making a purchase, the cardholder is confirmed by entering their PIN number.
With more automated kiosks popping up across the globe, the problem is getting worse with magstripe cardholders unable to use their cards at vending machines, rail stations, toll roads, bicycle rentals and other unattended pay stations. Although Visa says that most terminals have to ability to process older cards, attendants may not know how to process them.
But even with an aggressive campaign by Wal-Mart to offer the new global standard and a majority of credit and debit card holders having experienced difficulty using their cards abroad, banks and lenders continue to stonewall the new technology, due to the cost of implementing the system. New cards will need to be distributed to every cardholder and merchants would be required to install new payment processing equipment estimated to cost $8.6 billion. Some financial experts foresee the need for government intervention to force the adoption of the Chip-and-PIN technology in the U.S. since no one seems willing to pick up the tab.
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