Visa, MasterCard Team Up to Push for Better Credit Data Protections
As more information and new reports of data hacks continue to pour in, striking major retailers like Target, Neiman Marcus and others, the US is becoming increasingly aware of the many dangers associated with using debit and credit cards
MasterCard and Visa, whose businesses are eroded every time a consumer’s information is stolen, have decided to take action and are leading an effort to form a “cross-industry group to improve security for card transactions and press US retailers and banks to meet a 2015 deadline to adopt technology that would make it safer to pay with plastic,” Reuters reports.
Other members of the group include credit unions, banks, retailers, and industry trade associations, which are initially pushing for the implementation of technology already used in Europe and Asia—EMV cards—which “store information on computer chips rather than on traditional magnetic strips, making them harder to counterfeit,” according to the wire service.
In Europe and Asia, cards may also contain another layer of security by asking users to type in a personal identification number when actually making a purchase. However, the National Retail Federation hasn’t joined the group because it claims that Visa and MasterCard do not want to add the pin option. "They're not serious about reducing fraud, unless they put a pin on," said Mallory Duncan, the NRF's general counsel, Reuters reports. "We remain insistent that US retailers' customers be given the same protections as consumers in more than 80 countries who have both a chip and a PIN securing their credit and debit cards.”
However, Visa CFO Byron Pollitt told an investment conference in the last week that “PIN technology could slow down security improvements due to the investment required and existing infrastructure,” ZDnet reports.
Bickering between retailers and bankers is an ancient blood sport, as the two parties try to figure out who will foot the $30 billion upgrade bill for new cards. "Banks and retailers want to make sure that if they invest in new infrastructure, they'll get the return in reduced fraud," Wedbush Securities analyst Gil Luria told Reuters.
The group is also looking at how mobile and online transactions work. Back in February, Visa and MasterCard announced that they endorsed a mobile payment technology that was built into the latest version of the Android mobile operating system and would allow consumers to tap their device in order to pay, Recode reported. But mobile payments, which have been slowly adopted by consumers, pose perhaps an even greater risk of data theft. However, the new mobile payment system uses Host Card Emulation, which allows the phone to “transfer credit card data directly to [a] NFC terminal without storing it in your handset,” according to Engadget.
Source: http://www.brandchannel.com
MasterCard and Visa, whose businesses are eroded every time a consumer’s information is stolen, have decided to take action and are leading an effort to form a “cross-industry group to improve security for card transactions and press US retailers and banks to meet a 2015 deadline to adopt technology that would make it safer to pay with plastic,” Reuters reports.
Other members of the group include credit unions, banks, retailers, and industry trade associations, which are initially pushing for the implementation of technology already used in Europe and Asia—EMV cards—which “store information on computer chips rather than on traditional magnetic strips, making them harder to counterfeit,” according to the wire service.
In Europe and Asia, cards may also contain another layer of security by asking users to type in a personal identification number when actually making a purchase. However, the National Retail Federation hasn’t joined the group because it claims that Visa and MasterCard do not want to add the pin option. "They're not serious about reducing fraud, unless they put a pin on," said Mallory Duncan, the NRF's general counsel, Reuters reports. "We remain insistent that US retailers' customers be given the same protections as consumers in more than 80 countries who have both a chip and a PIN securing their credit and debit cards.”
However, Visa CFO Byron Pollitt told an investment conference in the last week that “PIN technology could slow down security improvements due to the investment required and existing infrastructure,” ZDnet reports.
Bickering between retailers and bankers is an ancient blood sport, as the two parties try to figure out who will foot the $30 billion upgrade bill for new cards. "Banks and retailers want to make sure that if they invest in new infrastructure, they'll get the return in reduced fraud," Wedbush Securities analyst Gil Luria told Reuters.
The group is also looking at how mobile and online transactions work. Back in February, Visa and MasterCard announced that they endorsed a mobile payment technology that was built into the latest version of the Android mobile operating system and would allow consumers to tap their device in order to pay, Recode reported. But mobile payments, which have been slowly adopted by consumers, pose perhaps an even greater risk of data theft. However, the new mobile payment system uses Host Card Emulation, which allows the phone to “transfer credit card data directly to [a] NFC terminal without storing it in your handset,” according to Engadget.
Source: http://www.brandchannel.com
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