Monday, September 21, 2015

Target's New Credit Chip

Credit card fraud is one major risk each person has when paying with this method.  In 2013, Target fell victim to this and had to pay back their customers nearly $10 million dollars (CNN).  This happened when "someone installed malware in Target's security and payments system that was designed to steal every credit card used at the company's 1,797 U.S. stores" (Bloomberg).  Since then, it has become one of their priorities to make sure something like this never happens again.  To make it more difficult to do something like this, Target is now using chip-and-pin cards.

Target's new method of payment makes it more difficult to steal credit card information because of its new technology.  "Cards with chip-and-pin technology are considered more secure than the magnetic stripe cards most of us use now because they are embedded with a microchip that generates a different, single-use code to process every transaction you make" (USA Today).  Any information stolen from a credit card with chip-and-pin technology will not work because the data that has been taken cannot be used again.  Target is reissuing all of their company branded credit cards, debit cards, and co-branded credit cards with this new technology.

Along with issuing new credit cards, Target also has to replace all of their cash registers with ones that can accept the new technology.  Since Target is so committed to never having a hack like they dealt with in November 2013, they "sped up its adoption of the technology and committed $100 million to the effort" (USA Today).

This new technology makes it nearly impossible for hackers to steal credit card information.  This gives consumers more incentive to buy from Target instead of competitors that have not adopted this new technology.  Having the security of not falling victim to credit card fraud is a great feeling for potential customers.  Target is taking a step in the right direction with this new technology and ensuring that something like the hack in 2013 will never happen again.

"Target Missed Warnings in Epic Hack of Credit Card Data." Bloomberg. Web. 20 Sept. 2015.
"Target Will Pay Hack Victims $10 Million." CNNMoney. Cable News Network. Web. 20 Sept. 2015.
Malcolm, Hadley. "Target to Reissue Cards as MasterCard Chip-and-pin." USA Today. Gannett, 29 Apr. 2014. Web. 20 Sept. 2015.

1 comment:

  1. While I see that the new technology developed in these credit cards can be very beneficial, I do not think they have as much significance in the United States as it appears. Because this new technology requires a specific reader that cost Target nearly $100 million dollars to implement, many companies are hesitant to adopt it. This is understandable because a small boutique that has not experienced an overwhelming amount of credit card fraud, such as Target, does not have an incentive to pay a lot of money to upgrade their credit card machines. Consequently, the credit card user is forced to use the magnetic strip, or the original problem that drove the invention of this new technology (Schulz). Therefore, until these new machines are widely adopted across the United States, even at smaller “mom and pop” stores, these new credit cards cannot be used to their full potential.

    Also, with online shopping increasing in popularity, people will undoubtedly continue to use their credit cards on the web. Because these new chips have made it hard to commit fraud in a traditional store setting, almost all countries that have adopted this new technology have seen a spike in online fraud. The credit card number and expiration date of a card with an EVM chip can still be stolen online (Mecia). Resultantly, the fraud problem that occurs in-store might have been eased but it has been at the expense of online card users. With online shopping becoming more and more popular, this raises a serious concern.

    Mecia, Tony. "Online Fraud May Surge after EMV Chip Card Rollout."
    CreditCardscom News. N.p., 9 Nov. 2014. Web. 23 Sept. 2015.

    Schulz, Matt. "The Unfortunate Truth About Your New Chip Credit Card." The
    Huffington Post., 8 Sept. 2014. Web. 23 Sept. 2015.


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