On October 17, 2014, just days before Staples announced that it was investigating a “potential [security] issue,” President Obama signed an executive order to accelerate EMV adoption in the United States.

The hacking trend first began in November of 2013 when—a few days before Thanksgiving—Target’s security and payments system was hacked. In the first retail hack of its size in United States history, hackers stole the 40 million credit card numbers from the thousands of retail stores in the United States.  Sincethen, stores likeNeiman Marcus, UPS, P.F. Changs and Michaels have all been victims to hackers. On September 8, 2014 Home Depot confirmed that its customers’ credit card data had been stolen. This surpassed Target as the biggest retail hack in United States history when hackers stole the information of an estimated 56 million credit cards. Now, only about one month later, it appears that Staples is hackers’ most recent conquest.

Why have these hackers been so successful? Unlike the rest of the world—which has embedded EMV microchips onto credit cards—the United States has continued to use 1960s magnetic strip technology. President Obama hopes to change that sooner rather than later. The United States was originally scheduled to make the transition from magnetic strips to EMV cards in October 2015. It is clear, however, that more immediate action is necessary. The President hopes that his executive order will “help drive the market towards swifter adoption of stronger security standards.” Many retailers have already pledged to activate EMV-compatible security terminals in early 2015. It is the President’s hope that following this executive order more companies will have a greater sense of urgency to take part in the transition.

While they are not 100% fraud-proof, EMV chips provide much greater security than the magnetic strip because they create a unique code for each transaction. They also can provide additional security by requiring the card-user to enter a pin. Will these EMV chips provide the necessary security to stop the retail-hacking trend? The hope is yes. While we will have to see what happens once they are finally implemented nation-wide, we can be sure that they will be more secure than the antiquated magnetic strips.


— Sara Hunter

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One Response to EMV Cards Finally Coming to the US

  1. Neil Issar says:

    Ignoring the cost of installing and testing EMV-compatible hardware in retailers across the country (which is sure to be in the hundreds of millions, if not billions, of dollars), my immediate question was whether the 2015 deadline is realistic. For example, Canada’s move to EMV chip-and-PIN technology started over a decade ago and still is not complete. EMV implementation may also be delayed until litigation regarding the Durbin Amendment is resolved. Moreover, will broad adoption and implementation of EMV technology simply mean that fraud will become more prevalent in online/mobile/card-not-present scenarios? This concern has been echoed before in other types of fraud, with some describing deterring fraud as a frustrating game of “whack-a-mole” – eliminate fraud in one area and it quickly pops up in another. The federal government’s push for greater card security is laudable, but I am concerned that pushing for widespread EMV chip-and-PIN adoption within the next year may be too optimistic and short-sighted.