Yet another major identity theft involving payment cards was made public last week, with customers of over 1000 stores hit by a data breach. Now, the Wall Street Journal is reporting that card networks, banks and retailers are accelerating the timetable to introduce more secure chip-and-PIN cards -- and retire the swipe for in-store payments.
It follows a spate of incidents where large-scale "skimming" of credit cards' magnetic strips has taken place in retail stores, garnering literally millions of stolen credit card numbers for use in further fraud or for sale to other criminals.
Despite widespread use in Europe and Asia, there are apparently as few as 50 million cards with chips in use in the US, out of more than 1 billion total cards. There has been a "chicken and egg" problem as retailers refuse to pay for costly new equipment until chip cards are more common, and banks don't want to introduce chip cards while chip readers are not widely in use.
Historically, chip-and-PIN systems have reduced the level of in-person fraud, but also led to increased online fraud as criminals switch to CNP (card not present) schemes instead.