Discover Card is the first one to come to their collective senses!

In a surprise move, Discover Card endorsed the chip-and-PIN system for EMV cards a week or so ago.  

Payments Source was the first to announce the news, noting that Nelms backed the move to make EMV cards more secure through the use of chip and PIN while speaking at the Electronic Transactions Association’s TRANSACT 16 meeting in Las Vegas.

We have been saying FOREVER that the chip and signature (or worse, chip and nothing!!!) method was not doing anyone any favors AT ALL!  The problem with not requiring either an ID or a PIN number at the time of use with a card – no matter whether you swipe it or insert it – does not do away with the most common types of fraud; that being the ones where someone has a credit or debit card in their possession that does not belong to them. 

We’ve also been advising every non-compliant merchant that we know (and the compliant ones too, since accounting generally paints with a very broad brush) to double and triple check their merchant account fee statements when they receive them; it’s become fairly commonplace that banks attach any chargebacks they can to the merchants directly – even the ones such as lost or stolen cards that they aren’t liable for no matter what type of terminal they are using.  

So, we are delighted to see that Discover is taking the initiative here, and are hopeful that other fin-tech issuers will decide to go the same way.

Side note: it’s also our opinion that entering a PIN and waiting for a transaction to clear will make the consumer think that the process is speedier than it seems right now, so that’s a win-win for merchants who are stuck in the middle of this whole brouhaha!