Payment Processing

Is Wal-Mart right?

Having launched programs on all sorts of payment networks, including Canada’s home grown Interac “PIN debit” system, Visa, MasterCard, Discover, and even Maestro in Europe, I can relate to both sides.  It’s true, right now as EMV is not common place in the US yet, the cards are a bit more expensive, as are the payment terminals. That being said, however, the added security is tremendous. Its easy to get up in arms about increased cost, especially if we don’t remember to look at what we’re getting for this increased cost.

A typical “mag stripe” card relies purely on data that has been embedded in the magnetic stripe. Anyone can buy an inexpensive card reader and record the data in the mag stripe, and with an easily obtainable machine they can then create a duplicate of the card. There are ways to make this more secure; but most of the rely on adding even more data to the mag stripe that’s just as easy to clone, unless you go so far as to require a PIN – and it’s not hard to simply video tape people entering the PIN to get around that.

There are questions from smart people about the EMV standard – it may not, in its current incarnation, be smart enough yet, even though it changes the game significantly. Many believe that it is enough to reduce the scope of the problem – but is it good enough?

So what are your thoughts? Wal-Mart says that EMV is the future – and that we should just get going with it already. I can relate – its frustrating watching the glacial change of pace with EMV.  Is it time?

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