Friday, December 4, 2015

New Credit Card Chip Technology Makes Debut as Holidays Approach

Have you recently noticed having a longer wait when checking out at various stores? Part of the reason is that there were more people out shopping, in preparation for Thanksgiving and Christmas. Another reason is that checkers are having some difficulty getting used to new systems designed to deal with the new "chip" credit cards. In Samantha Masunaga's L.A. Times article, she describes the new type of credit card, the reasons why it was created, and how its creation has affected shoppers.

While everyone expects longer lines around holiday times, analysts expect that the new credit cards may make lines extra long this year. Starting October 1st of this year, many new credit cards began to come equipped with a small metallic chip. This chip, which makes purchases safer and fraud harder to commit, has also caused something of a headache in that it has forced merchants to install new terminals that are able to accept the new cards. Since it is expected that 70% of cards will have the new chip technology by the end of the year, most merchants and card issuers have found that they should jump on the bandwagon.

While shoppers and checkers are all still trying to get used to the new card chips, leading to confusion and a longer wait time, eventually, as the chips become more common, it is expected that the lines will go back to normal. In all, though, customers seem to be taking the longer lines in stride, understanding that the increased security is worth a little bit more of a wait. Because it makes it harder to create a fake credit card or steal another person's information, the chip in the credit card helps to reduce identity theft and fraud.

Major retailers like WalMart, Target, and Home Depot have already transitioned to new technology that can accept chip cards, but some smaller companies are yet to complete the transition. However, by 2017, all merchants, including gas stations, will be forced to adopt new terminals that can accept the chip cards. Some shoppers have admitted to avoiding using their new chip cards, at least for the time being. While the difference between a chip card and a standard magnetic strip card can be as little as a few seconds, a delay of a minute or two can be caused by someone trying to swipe a chip card. If the mistake occurs several times throughout the day, the seemingly insignificant delays can add up. Because of this, many people not accustomed to the new technology try not to use it, so as to avoid causing a hold-up in the checkout line.

Some merchants claim that they argued with credit card companies about releasing the new cards right before the holidays, out of fear for potential back-ups. They would have preferred to start the new cards in January or February when customer traffic is less and slightly longer lines would be not as noticeable. Unfortunately, credit card companies chose to issue the new cards late this year. On the positive side, customers will be able to get plenty of practice over the holiday season and learn to use the cards properly. Some stores claim that delays are unnoticeable, others state that lines are only slightly longer, and customers have reported some even longer delays. Either way, even if the issue is minimal, use during the next month or so will provide shoppers with the chance to master the new technology and keep even minimal delays reduced in the future.

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