Chip And PIN Cards Finally Coming To U.S. (Business Insider)   Leave a comment

One of the best ways to see the quaint streets and towering monuments of Paris is by bicycle. For a mere euro per half-hour, you can rent one in any Parisian neighborhood — unless you’re using an American credit card.

The Velib’ bike rental system is just one of many travel conveniences unavailable to most Americans because their magnetic strip-based credit cards are obsolete. Many kiosk systems abroad, like gas pumps and metro ticket machines, cannot read American credit cards. But at long last, Wells Fargo and JP Morgan Chase are helping the United States catch up with the rest of the developed world by offering cards embedded with microchips. The so-called “Chip and PIN” technology is old news in not only in Europe but in countries like Japan, Canada, China, Mexico and Brazil.

In a pilot program, Wells Fargo will test microchip-embedded cards with 15,000 customers it considers frequent travelers, including college students and some of its private banking clients. The bank plans to send out the cards in a few months. JPMorgan Chase is adding microchips to its ultrahigh-end Palladium card. And some credit unions around the country, including the State Employees’ Credit Union of Raleigh, N.C., are starting to offer debit cards with a chip. The United Nations Federal Credit Union in New York has offered such credit cards for about a year, according to The New York Times.

The chip technology, called EMV, helps reduce fraud and has an embedded microprocessor that contains the information needed to make payments. A PIN must be entered with each purchase. One reason the U.S. has not yet adapted the technology may be that it has not had as many credit card fraud problems as other countries, reported The Times, which also speculated that the looming cuts to credit card swipe fees could cause banks to give EMV chips a closer look.

Until the U.S catches up, what’s an international traveler to do?  Travelex, the currency converter, offers prepaid debit cards called Cash Passports, some of which feature EMV chips. Travelers can choose from a number of local currencies and use the card at retailers, ATMs and anywhere else the locals can use a card. And since the balance is preloaded, the card can help travelers stick to their budget, too.

Read more: http://www.businessinsider.com/chip-and-pin-cards-finally-coming-to-us-2011-4#ixzz1KDwjKnMc

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Posted April 22, 2011 by ilanamelissagreene in Uncategorized

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