I’m surprised that merchants haven’t stepped up their transition to chip-cards, especially now that the issuing banks are no longer responsible for fraud. All of our credit cards have chips in them, even some store-issued cards.
For millions of merchants that haven’t yet met the credit-card industry’s deadline for accepting more secure plastic, the bill is coming due.
As of last October, retailers who didn’t make the transition to chip cards are on the hook for counterfeit transactions that used to be covered by card-issuing banks. The costs of the fraud, known in the industry as chargebacks, are starting to stack up.
The credit-card industry and retailers battled for a decade over rolling out chip cards, which are more secure but also require new payment terminals and take more time at checkout. The balance tipped against retailers after a spate of cyberattacks hit major chains such as Target Corp. and Home Depot Inc. and compromised millions of cards.
Target, Home Depot and some other large merchants, including Wal-Mart Stores Inc., are now processing chip transactions, but there are still plenty that haven’t installed the new equipment and are for the first time facing sizable costs for counterfeit transactions.
Financial institutions have been issuing the new cards to customers for more than a year, but just 22% of retailers are able to process them, according to a survey released last month by Boston Retail Partners. Another 53% of the merchants in the survey planned to install the systems within the next 12 months.
Some of them didn’t want to install the new equipment before the busy holiday shopping season and have been surprised to discover that there is a long wait to get it certified, according to payments executives and merchants.
(click here to continue reading More Chip-Card Headaches, This Time for Merchants – WSJ.)
I wonder if lawyers for various merchants are considering making consumers responsible? Or what really is the hold up? Boggles the mind that only 1/5 of the retailers have converted their credit-card accepting machines. This isn’t a new thing, sprung without warning. The change has occurred over years…