Wal-Mart will be adding smartcard payment capabilities to its U.S. locations
Wal-Mart has announced that it will add smartcard payment capabilities to all of its payment terminals in the U.S.
The smartcard technology – which uses an embedded chip to store cardholder data instead of a magnetic strip – is widely used in retailers across the world, but has never caught on with companies in the U.S. Instead of signature-based card processing, the cards would require users to punch in a PIN.
StorefrontBacktalk.com quoted Jamie Henry, Wal-Mart’s director of payment services, as saying that that the current systems were a "waste of time."
Analysts say the move by Wal-Mart could have a trickle down effect which leads more companies and banks to adopt the system. Many companies had resisted the transition because of the costs associated with replacing all of their existing terminals to allow for the new transactions. As the system progressed, banks would also need to issue new cards to customers.
Computerworld says that the information on smartcards is thought to be more secure that traditional credit cards, but security researchers have shown that the transactions can be broken and hacked. The site says that the continued use of magnetic strip cards has actually brought an increase in credit card fraud to the U.S.
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