Chip & Pin Credit Cards Interview with WTOP Radio Washington

By Media Relations Senior Industry Analyst Matt Schulz spoke on Tuesday, July 21, 2015, with Joan Jones and Mike Moss of WTOP Radio Washington about the Chip & Pin credit cards. The interview and transcript are below.


Joan Jones: A MasterCard executive says if credit card companies reduce hacking opportunities with their newer chip and pin technology, he’s afraid hackers will target more banks. And joining us live is Senior Industry Analyst Matt Schulz. Good morning, Matt.

Matt Schulz: Good morning.

Jones: Ok, good to have you with us. So that’s kind of a strange statement to make because hackers are already going after banks. What’s behind that?

Schulz: I think what he’s talking about there is basically the bad guys going after low hanging fruit. Because essentially that’s kind of how they see merchants now because so many merchants haven’t necessarily done the best job of protecting their information historically. So if by integrating chip and pin and EMV cards, that level of protection increases so the bad guys might look some place else, including a bank.

Mike Moss: Surely he’s not suggesting we shouldn’t do everything we can to make sure these credit cards are so uncompromisable as is possible given the fact that hackers always seem to be a step ahead of us. But on the other hand, does he have an ideas or solutions where we could create programs, some kind of standardized methodology where all of us would be more protected? And if you want to be able to sell to your customers using credit cards, you’ve got to meet that standard.

Schulz: Well, there are some standards already, but I think that part of what he might be doing is just adjusting expectations because as much of an important step as these smart chip cards are, they’re certainly not a perfect thing. And while they will certainly reduce fraud with people using counterfeit cards and that sort of thing, it’s not going to remove all the problems. It might end up creating more online fraud, for example. So I think that what he’s doing, to a degree, is just helping to adjust people’s expectations of the power of these tools.

Jones: But presumably the chip and pin technology is better than what we’ve got now. So why would banks and credit card companies kind of drag their feet on getting this technology put in place?

Schulz: There’s no question that EMV is better than what we have now. And really what the question has always been is money because it’s not cheap for the banks to issue these cards and it’s not cheap for the merchants to update your checkout counters to accept these cards. And the last thing that banks and merchants wanted to do during the Great Recession is spend money on cards and infrastructure that people weren’t able to use yet. They were just trying to meet their bottom line.

Moss: Yeah. On the other hand it just seems crazy that, you know, we’re encouraged to use these things as a way of having this digital economy, but we’re the ones who get compromised and though the banks often cover those things, I’m sure we’re paying for it in fees and other charges as well. Well, it’s a conversation, Matt, we’ll continue at a later date. That is Senior Industry Analyst Matt Schulz.

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