Cardholders clueless on chip and pin

R. A. Hettinga rah at
Mon Aug 16 08:51:12 EDT 2004


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Cardholders clueless on chip and pin
By (press.releases at
Published Friday 13th August 2004 08:46 GMT

Retailers will be bracing themselves for what could be a chaotic festive
season following the news that more than half of British cardholders know
little or nothing about the new chip and pin card system.

Up to 120 million new chip and pin cards will be winging there way to
Christmas shoppers in time for the 1 January 2005 deadline, when retailers
will be required to introduce the new system.?

The new cards are designed to combat fraud by replacing magnetic strips
with information stored on a microchip which customers must verify by
keying in a four digit pin number.

IT consultant and fraud specialists, Detica, who commissioned the research
said that it had come across incidents where retailers had refused to serve
customers failing to remember their pin or even refusing to use it in the
first place.

According to David Porter, Head of Fraud & Security at Detica, a lot needs
to be done between now and December. He said: "Retailers need to act
quickly to help their customers. Nearly three-quarters of the public are
confident chip and pin will reduce theft and fraud once it's explained to
them, but retailers can't afford to begin educating everyone individually
at the busiest time of the shopping year. They need to begin a prominent
education system in stores now. With 117 shopping days to Christmas, the
clock is ticking."

With the number of pin numbers to remember set to increase, analysts are
also worried that cardholders may change all their pins to one number or
share their pins, a danger that could adversely increase the likelihood of

At present among those who have more than one pin or security code to
remember, almost half pin-share for two or more things requiring a code.

With one in three people affected by card fraud and a cost to the UK of
£425m in 2002, Detica are still confident that the new system will
significantly reduce card crime.

However there are those who remain cautious about the immediate impact of
chip and pin. A chip and pin spokeswoman said of Detica's findings: "This
contradicts all the research we have done. Transaction times are reduced
with chip and pin, not necessarily in the first instance, but beyond that
it is faster to use a pin than a signature."

Copyright © 2004, (

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© Copyright 2004

R. A. Hettinga <mailto: rah at>
The Internet Bearer Underwriting Corporation <>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

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