Everyone has heard something about this and many, many fears have been expressed regarding privacy and Canadian law.The fact is that chip technology is neither new nor an invasion of privacy; it is however, an added level of security to your cards.
Bear in mind this is not a biometric card that requires fingerprint or other methods of security, nor does it store any personal data much beyond the information encoded on the magnetic stripe of your current debit card.The chip card does however contain a tiny microchip that not only holds your PIN but also encoded information about the bank issuing the card.This provides a much greater level of security against fraud and who doesn’t want that?
The need for this technology in Canada was underscored a week ago with the possible fraud at kiosk terminals at Toronto’s Pearson International Airport.Granted this was not a debit fraud but a credit card one, the principle is still the same.People could suffer identity theft which is far worse a situation than just a credit or debit card fraud.
This is not the first time hackers have invaded computer systems, nor will it be the last, but more importantly is the fact that the chip card with its encoding security will reduce the illegal activities to a minimum.Certainly thieves will always try and may succeed but with the chip card, breaking into it will be more difficult and hacking the data transmission will be far more difficult than at present.
The changeover is beginning sometime in the next year and will be phased in over several years.The only real difference to the existing method is the consumer will insert his or her card into the reader at the beginning of the transaction then enter the PIN instead of at the end.
It is a win-win situation for both the consumer and the banks.Although unlikely that any fee reductions would be seen, the cost of fraud will be reduced.It has been in use in Europe for several years and North America is just now beginning to catch up.Currently it is being tested in Canadian markets in Waterloo Ontario and region.
This is one consumer who welcomes any efforts to increase security of personal and financial information.Now if we can only get the retailers…