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In the US they have finally started rolling out chip-based cards. However, there's no PIN needed if you run the card as credit, defeating much of the security.

by 0xfeba 9y ago

alasdair_ 9y ago
>defeating much of the security. In many ways, this is better, since a skimmer can't grab my pin and credit cards have rules where they must immediately refund fraudulent purchases, while debit cards are often much more difficult to reverse.
- bkor 9y ago
  Your PIN being skimmed is refunded in The Netherlands without any problem. They usually use the combination of the magnetic swipe and your PIN. Restricting bank cards to just EU reduced this fraud to around 15% of the original amount. See https://www.rtlnieuws.nl/nieuws/binnenland/skimmen-met-80-procent-gedaald https://www.rtlnieuws.nl/nieuws/binnenland/skimmen-met-80-pr.... This was implemented around 2012.
  - rocqua 9y ago
    In the Netherlands, magnetic swipe has basically been phased out. You are now supposed to use the chip (and obviously still PIN). I think this happened around 2014, basically, the 'swipe' part of almost all readers is now blocked by a sticker that instructs you to use the chip. I'm not sure if the sticker can be moved in case you really want to swipe. Tap-payment is also being rolled out quite rapidly. It's about 1.5 years old and I'd say I now tap for 70% of all transactions. The move
nawgszy 9y ago
I just moved to the States from Canada. Surprised me how far behind payment technologies are here. Swiping is at least as common as the chip readers. I have been to two places that accepted tap and it blew the employee's mind both times that I had a card capable of doing that. I find this an especially entertaining juxtaposition with the transit systems. In Canada, you swipe on the bus and tap in the stores; in the US, swipe in store, tap on the bus.
- hughes 9y ago
  I found that strange as well. Chip and signature, or swipe and pin are the common options. Both miss the entire security aspect of chip and pin.
  - phil21 9y ago
    As with all strange things, they can usually be explained by incentives. Banks get paid far less interchange rates for Chip & PIN than they do signature. Thus the system we have. So some banks can skim an extra .5-2% off the top of every single transaction in the US.
    - techsupporter 9y ago
      > Banks get paid far less interchange rates for Chip & PIN than they do signature. This only applies if the PIN is being used for debit. I have two credit cards[0] that are issued by US-based financial institutions and, when the chip reader is equipped to do so, result in a prompt for a PIN when used. The interchange rate is as a normal credit card. The bigger issue, as has been explained to me by two people I know who work in payment tech, is that credit card issuers in the States are utterly panicked by the idea of doing anything that might result in even a small fraction of a percent of their cardholders switching to another card. PINs are seen as inducing friction or a previously-unknown step into the payment process (since US customers have been conditioned for 20 years to "enter a PIN for debit" and "sign for credit"). To now change to PIN-primary cards would result in confused customers, higher support costs, and plenty of customers switching either to another credit card or to (the horrors) another payment method entirely, like cash. So the theory goes, anyway. Therefore, US banks are loathe to introduce cards that can be verified by PIN at all, much less ones that are primarily verified by PIN. 0 - They are not debit cards with VISA or MasterCard logos; they are actual credit cards accessing a line of credit. One comes from the State Department Federal Credit Union and the other from First Tech Federal Credit Union.
      - phil21 9y ago
        Interesting, I guess I always thought this applied to credit as well, just not as drastically. I stand corrected. > Increased revenue: In the US, the different in interchange rates between PIN-based debit and signature-based debit transactions can be substantial for larger dollar payments. Although Regulation II (a.k.a. the Durbin amendment) caused the card networks to reduce debit interchange rates for the largest card issuers to just 0.5% plus $0.22, this still results in interchange of about $0.72 on a $100, signature debit purchase. The same PIN-debit purchase might generate about $0.25 and possibly less in a area where there's substantial competition between PIN-debit networks. To be fair, this isn't true for credit card transactions (since there is effectively no such thing as a PIN-based credit card transaction in the US today and therefore no distinct interchange rates for PIN-based payments) but is does explain why there might be a general preference not to proliferate the use of PINs as the US card population and terminal base is converted to support EMV.[0] [0] - https://www.quora.com/Why-is-the-USA-adopting-chip-signature-and-not-chip-pin https://www.quora.com/Why-is-the-USA-adopting-chip-signature...
johncolanduoni 9y ago
Not from the issuer's perspective. They're mostly interested in combating forged cards, not stolen ones, because the former accounts for the majority of their losses.

In the US they have finally started rolling out chip-based cards. However, there's no PIN needed if you run the card as credit, defeating much of the security.

by 0xfeba 9y ago

In the US they have finally started rolling out chip-based cards. However, there's no PIN needed if you run the card as credit, defeating much of the security.

alasdair_ 9y ago

>defeating much of the security. In many ways, this is better, since a skimmer can't grab my pin and credit cards have rules where they must immediately refund fraudulent purchases, while debit cards are often much more difficult to reverse.

bkor 9y ago
Your PIN being skimmed is refunded in The Netherlands without any problem. They usually use the combination of the magnetic swipe and your PIN. Restricting bank cards to just EU reduced this fraud to around 15% of the original amount. See https://www.rtlnieuws.nl/nieuws/binnenland/skimmen-met-80-procent-gedaald https://www.rtlnieuws.nl/nieuws/binnenland/skimmen-met-80-pr.... This was implemented around 2012.
- rocqua 9y ago
  In the Netherlands, magnetic swipe has basically been phased out. You are now supposed to use the chip (and obviously still PIN). I think this happened around 2014, basically, the 'swipe' part of almost all readers is now blocked by a sticker that instructs you to use the chip. I'm not sure if the sticker can be moved in case you really want to swipe. Tap-payment is also being rolled out quite rapidly. It's about 1.5 years old and I'd say I now tap for 70% of all transactions. The move

nawgszy 9y ago

I just moved to the States from Canada. Surprised me how far behind payment technologies are here. Swiping is at least as common as the chip readers. I have been to two places that accepted tap and it blew the employee's mind both times that I had a card capable of doing that. I find this an especially entertaining juxtaposition with the transit systems. In Canada, you swipe on the bus and tap in the stores; in the US, swipe in store, tap on the bus.

hughes 9y ago
I found that strange as well. Chip and signature, or swipe and pin are the common options. Both miss the entire security aspect of chip and pin.
- phil21 9y ago
  As with all strange things, they can usually be explained by incentives. Banks get paid far less interchange rates for Chip & PIN than they do signature. Thus the system we have. So some banks can skim an extra .5-2% off the top of every single transaction in the US.
  - techsupporter 9y ago
    > Banks get paid far less interchange rates for Chip & PIN than they do signature. This only applies if the PIN is being used for debit. I have two credit cards[0] that are issued by US-based financial institutions and, when the chip reader is equipped to do so, result in a prompt for a PIN when used. The interchange rate is as a normal credit card. The bigger issue, as has been explained to me by two people I know who work in payment tech, is that credit card issuers in the States are utterly panicked by the idea of doing anything that might result in even a small fraction of a percent of their cardholders switching to another card. PINs are seen as inducing friction or a previously-unknown step into the payment process (since US customers have been conditioned for 20 years to "enter a PIN for debit" and "sign for credit"). To now change to PIN-primary cards would result in confused customers, higher support costs, and plenty of customers switching either to another credit card or to (the horrors) another payment method entirely, like cash. So the theory goes, anyway. Therefore, US banks are loathe to introduce cards that can be verified by PIN at all, much less ones that are primarily verified by PIN. 0 - They are not debit cards with VISA or MasterCard logos; they are actual credit cards accessing a line of credit. One comes from the State Department Federal Credit Union and the other from First Tech Federal Credit Union.
    - phil21 9y ago
      Interesting, I guess I always thought this applied to credit as well, just not as drastically. I stand corrected. > Increased revenue: In the US, the different in interchange rates between PIN-based debit and signature-based debit transactions can be substantial for larger dollar payments. Although Regulation II (a.k.a. the Durbin amendment) caused the card networks to reduce debit interchange rates for the largest card issuers to just 0.5% plus $0.22, this still results in interchange of about $0.72 on a $100, signature debit purchase. The same PIN-debit purchase might generate about $0.25 and possibly less in a area where there's substantial competition between PIN-debit networks. To be fair, this isn't true for credit card transactions (since there is effectively no such thing as a PIN-based credit card transaction in the US today and therefore no distinct interchange rates for PIN-based payments) but is does explain why there might be a general preference not to proliferate the use of PINs as the US card population and terminal base is converted to support EMV.[0] [0] - https://www.quora.com/Why-is-the-USA-adopting-chip-signature-and-not-chip-pin https://www.quora.com/Why-is-the-USA-adopting-chip-signature...

johncolanduoni 9y ago

Not from the issuer's perspective. They're mostly interested in combating forged cards, not stolen ones, because the former accounts for the majority of their losses.