The U.S. hasn’t updated its debit card security technology to include common security applications on ATM cards in other countries
Updates in the global ATM card industry have shown increasing trends to adopt smartcard technology that prevents scams, but the U.S. has been hesitant to adapt.
The Smart Card Alliance has reported 22 countries, including China, India, Mexico and Canada have adopted smartcard technology such as microprocessor chips for ATM cards. This technology is useful in the prevention of ATM skimming scams, in which criminals copy data from plastic cards’ magnetic stripe and store it onto a blank plastic card, which can then provide access to the original ATM card users’ banking data. Bank card developers in the U.S. have yet to upgrade to more secure smartcard technology on ATM cards, possibly because of Javelin Strategy and Research’s estimate that implementing the technology could cost the plastic card payment industry nearly $8.6 billion.
According to Visa, many countries still support outdated magnetic stripe cards from U.S. systems. However, the company did report that, because of the improved technology in other countries, travelers from the U.S. may have an issue accessing account information at updated foreign ATM machines, and has publicly advised users to find an attendant "in the rare instance that a card holder encounters a problem."
Large companies in the United States have recently called for chip and PIN technology on smartcards. Officials with Walmart have recently spoken with smartcard providers about updating to include the security technology.
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