Wednesday, February 19, 2014

Why we can't have nice things...  

Count me alongside Kevin Drum on the issue of better credit cards here in the US.
In any case, we're finally getting EMV technology in the United States starting in 2015. But in possibly the stupidest decision in the history of payment networks, we're actually getting chip-and-signature cards. Why? I've been unable to find a straight answer to this. The banks vaguely talk about merchant resistance to getting new terminals that accept PINs, but that makes no sense. PIN terminals aren't very expensive, and the cost would be effectively zero if you have a five or ten-year phase-in.
Alternatively, they make noises about American consumers not being used to PINs, but that doesn't make sense either. We all use PINs for our debit cards already. We'd learn to use PINs for credit cards in about five minutes.
And then, to add insult to injury, the cards we're getting will mostly be signature-only. That's not a requirement of the technology, though. They could be "signature preferred," which requires a signature if possible but accepts a PIN if not (at automated kiosks, for example). Why not do that? I truly have no idea.
Honestly, the whole thing is just a mystery. EMV technology is old and well-tested. Everyone knows how to make the transition because dozens of countries have already done it. It's not wildly expensive. It wouldn't spark a consumer revolt. So why are we getting idiotic signature-only PIN cards, which are probably the worst possible compromise imaginable? They require more expensive cards and upgrades to infrastructure, but they don't provide much additional security and they don't work universally outside the US. [More of a quality rant]
I got a new Citicard with chip before going to Africa last year. Just called them up and asked. But I didn't realize it wasn't a real EMV card like my European friends have.

Cripes, if we admit they can build better cornheads why can't we accept they have better credit cards? And adopt them?

No comments: