Will we catch up with Europe in credit-card security at last?

I WRITE ABOUT PARIS, but this story is true there and absolutely every other place in Europe: You go to the restaurant, and all around you the locals are paying with plastic. They push their card into the small wireless machine the waiter brings to the table, key in a PIN, get their receipt, and leave. No signature required, and it’s fast.

Waiters machine
A typical European restaurant card reader

You, on the other hand, have to wait while the waiter looks quizzically at the card for its chip (puce in French), then slides its magnetic strip through the slot on the side of the machine just like you do at home. Then you sign the receipt.

The chip, or puce
The chip, or puce

Which is more secure? If recent history is any indication, the European restaurant or shop is far more secure. The New York Times’s Bits section said today that British counterfeit and stolen card fraud has dropped 60 per cent over the last decade, while the same figures on the American side of the Atlantic have jumped about 50% in the same period. (The total is now about $160 million in Britain and $3.2 billion here, but that doesn’t mean much because the economies are of very different sizes.)

The European chip won’t prevent the bad guys from stealing your information in all cases, but if they do steal it they won’t be able to copy the card or use it elsewhere.

The new cards are coming in the United States. Businesses have resisted because of the cost, but card fraud has increased 30 per cent in recent years, so that by itself if a major incentive to upgrade. (Check Home Depot the next time you’re there — new machines, with the ability to handle the new cards. Did its major hack have anything to do with that?)

Another big incentive is that as of October next year the financial cost of card fraud will shift from the issuers to the merchants, if those merchants have not upgraded their equipment.

(By the way, there’s no fuss about a tip because it’s included in the price. The servers receive a salary. They will appreciate it if you leave a little spare change on the table in recognition of a good job, but it makes very little difference to their income, which is one of the reasons people frequently spend their entire careers working in restaurants.)

 

 

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