One year after the U.S. reached a milestone in its switch to credit cards that require a dip instead of a swipe, the ability to use such cards has dramatically increased.
But potential headaches loom heading into the holiday season, with some shoppers complaining that checking out with a chip takes too long and stores continuing to encounter delays getting chip-reading terminals up and running.
“This whole transition has been a challenge for merchants and for our customers,” says Mallory Duncan, general counsel for the National Retail Federation. “It’s not one we wanted. It’s extraordinarily expensive. It’s cumbersome, and worst of all it doesn’t really protect our customers to the extent we want.”
Chip-enabled — or EMV, which stands for Europay, MasterCard and Visa — cards are more secure than those with only a magnetic stripe because they generate a unique code for every transaction, making them more difficult to counterfeit. To expedite the switch, a liability shift occurred last Oct. 1 so that U.S. merchants are now held liable for fraudulent transactions made with counterfeit cards if they did not have a chip-reading terminal.
Since then, the pace of adoption has dramatically accelerated. As of July, 88% of MasterCard consumer credit cards in the U.S. were chip-enabled, a 105% uptick since October, while 2 million merchant locations were able to handle EMV transactions.