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May 26, 2014

Visa, MasterCard renew thrust for chip cards to reduce data breaches

In the wake of recent high-profile data breaches, Visa and MasterCard have reportedly renewed their push to accelerate the adoption of microchips into American credit and debit cards.

By Verdict Staff

In the wake of recent high-profile data breaches, Visa and MasterCard have reportedly renewed their push to accelerate the adoption of microchips into American credit and debit cards.

Card processing firms believes that microchips fitted plastic cards will significantly reduce card frauds, while protecting personal data of US consumers, as reported by Associated Press.

MasterCard’s group head for US product delivery Carolyn Balfany told Associated Press that chips aren’t perfect, but the extra barrier they present is one of the reasons criminals often choose to target US-issued cards, whose magnetic strips are easy to replicate.

"Typically, fraudsters are going to go to the path of least resistance," Balfany told the news agency.

Due to disagreement between retailers, card issuers and processors over the issues such as which processing networks will get access to the new system and associated cost, the chip technology has not been adopted in the US. However, the disputes have now largely been resolved.

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