While financial institutions have responded to the October 1 deadline Visa and MasterCard set for the transition away from magnetic-stripe card security to chip security, retailers have not.
Merchants who do not implement chip payment terminals are now liable for fraudulent purchases made in their stores. Roughly $8 billion in fraudulent card purchases are made in the U.S. annually.
CardHub conducted a survey of 55 major retailers and 1,000 individuals that showed 43 percent of retailers who have experience data breaches in the past five years have not updated their point-of-sale terminals.
The survey showed:
- 42% of retailers have not updated the terminals in any of their stores.
- 56% of individuals don’t care if a retailer’s payment terminal is chip-enabled.
- 41% of individuals say they don’t have a smart-chip credit card or don’t know if they have one.
- 62% of individuals don’t understand the difference between major card security standards.
- 41% of individuals falsely believe debit cards protect them from fraud better than credit cards.