Chip Card Deadline A Day Away
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MIAMI (CBSMiami) - Beginning Thursday, making a purchase with your credit card should be a lot safer - if.
That is "if" you have a newer credit card with an embedded electronic chip. And "if" the store or retailer you're making the purchase at has a new card reader which can "read" that chip.
As of October 1st, businesses are supposed to have new card readers in place under a schedule set by MasterCard and Visa, according to the Sun-Sentinel.
Eric Brown recently got his in the mail.
"These being more secure, is kinda reassuring," said Brown.
As for gas stations, they have a little more time. They don't have to make the switch until 2017.
Named after the developers, Europay, MasterCard and Visa, the new cards with the chips are called EMV cards. The chips in the cards generate a one-time code for each transaction. Banks and credit card issuers believe this will add an additional layer of security.
If a company delays in purchasing and using the new card reader, and a counterfeit card is used to make a purchase the retailer, and not the bank or credit card company, will be liable for the loss.
"They will bear the liability in case of credit card fraud and that's a big shift because in the past banks have bore most of that liability so that's a big deal for merchants," said Senior Industry Analyst Matt Shulz with Creditcards.com
According to the Florida Retail Federation, many small retailers are not ready to switch to the new cards.
A recent poll finds only 27 percent of retailers have the new, more expensive, card processors. Another survey says 64 percent of credit card users have not received the new chip cards yet.
"Nobody's quite ready for the deadline," said Shulz. "Merchants don't have the terminals generally to accept these cards. Banks haven't gotten enough of the cards into people's hands and overall there's just a lot of confusion."
The delay is due to the fact over a billion debit and credit cards have to replaced.
Also, the new card readers cost a couple of hundred dollars to $1,000 apiece. If a business doesn't have one, the old readers will work, but they won't provide the extra protection.
Consumers who haven't received the chip cards can still swipe and won't be responsible for any fraudulent charges.
We are number one when it comes to identity theft nationwide. Last year alone, the Federal Trade Commission had 18,428 complaints of identity theft from South Florida alone.
