The Problem With Visa’s New Chip Payment Cards

by drjim on August 24, 2017

Visa has introduced new cards with chips but they are really slow

Visa has introduced new cards with chips but they are really slow
Image Credit: Aranami

So let’s be clear about this: I am all for more security when it comes to my credit cards. On more than one occasion I’ve discovered that somebody out there has “cloned” my credit card and is running around town buying things with it. The good news is that the credit card company detects what is going on and shuts the card down, the bad news is that I have to wait a week until new cards show up that I can use. Visa has a fix for this problem; however, it’s looking like someone didn’t use their IT manager skills because their fix might be worse than the problem that they are trying to solve!

Why Make Changes To Credit Cards?

It turns out that credit cards are very valuable to thieves. If a bad guy can get his or her hands on one of your credit cards they can very easily go around town and make as many purchases as they want to. There are very few safeguards in place to prevent this from happening – who ever really compares your signature to the one on the card? As we have all learned in our IT manager training, even worse is if a thief can get their hands on a stolen list of credit card information. Using this information, they can create duplicate copies of your credit cards without ever having met you.

The credit card companies are the ones who have to pay out when this kind of fraud occurs. The laws that are currently in place state that the person who’s credit card is stolen is not responsible for any of the charges that the thief rings up. Clearly the companies are motivated to find a way to put a stop to this kind of crime. The good news is that they think that they have a way to make this happen: chip technology.

The new credit card security system works in this way. Each Visa card will now be embedded with a computer chip. This chip will now provide a unique code for each transaction. This will be different from traditional credit cards which rely on the data that is encoded on a magnetic strip that is located on the back of the card. Unfortunately the new chip cards won’t be able to stop the bad guys from hacking into a company’s payment system. However, any data that they are able to steal should now be worthless because the data will change each time the card is used.

What’s Wrong And How Is It Going To Get Fixed?

This new level of security sounds great doesn’t it? Well, yes and no. The problem that has come along with the new cards is that it is now taking much longer to check out. When using the new chip enabled cards to make a purchase, an additional 10-20 seconds has been added to the process. This is aggravating both customers and store owners who are always searching for ways to move customers through their checkout lines faster.

The length of time that a purchase takes with the new cards depends on where you are making the purchase. How the payment terminals are configured can play a big role in the total transaction time. Additional factors include the speed of the connection and if the terminals prompt the user on how they want to make the payment. A study has been done on the impact of using a chip based card to make a purchase. What they discovered is that the chip card added 8-12 seconds per checkout process.

The good news is that this is a problem that can be fixed. Visa has announced that they are going to be introducing new software that will shave up to 18 seconds off of the time that it takes a consumer to make a payment. Additionally, Wal-Mart has reduced the required time by 11 seconds by eliminating a prompt that asked consumers to confirm the amount of the transaction. The new software will reduce the amount of time that the consumer has to keep their card in the reader. The card will now be able to be removed while the cashier is still in the process of ringing up the order.

What All Of This Means For You

The world of credit cards is filled with bad guys. These people want to either steal your actual credit card or while we are all off doing IT team building, they want to download the data that is contained on the magnetic strip on your credit card so that they can make a clone of your card. Once they do this, they can go buy things in your name. Visa has created a new type of credit card that has a chip built into it; however, there are problems.

The new Visa chip cards are designed to make using credit cards to make purchases more secure. Each time you use the card, the chip allows a new transaction number to be created. Now if the bad guys steal your information, they won’t be able to use it to make a copy of your card. However, the new cards take a long time to complete a purchase. Consumers don’t like to stand around for an additional 8-12 seconds per transaction. Visa is in the process of rolling out some new software that they hope will speed things up.

Creating a new type of credit card is probably a good idea for Visa. They need to boost security and make it harder for the bad guys to buy things that Visa will ultimately have to pay for. However, their new chip based credit cards are talking too long to complete transactions. If Visa can create software that will speed the process up so that it takes only as long as it did before, then everyone will be happy to use the new, more secure card.

– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World IT Management Skills™

Question For You: How quickly do you think that Visa should make everyone switch over to the new chip based cards?

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What We’ll Be Talking About Next Time

The nature of what it really means to “go to work” has been changing for a long time. Nowadays there is a very good chance that you and your boss may not work in the same office. You (or your boss) may work from home or be operating out of a different office. What this means for you as an IT manager is that the toughest long-distance relationship that you are going to be involved in may be with your boss!

{ 2 comments… read them below or add one }

Nick Gilkes August 24, 2017 at 9:36 am

And yet these have been in use in Europe for YEARS with no complaint. There is no fuss here.

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drjim September 1, 2017 at 3:24 pm

Nick: … and you are correct. I’m under the impression that in Europe they did a good job of implementing a 2-step process that really does secure the card. Here in the U.S. for some reason we only went half way and so we’re left with the solution that we have…

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