On October 17, 2014, President Obama signed an executive order for its BuySecure Initiative requiring government agencies to transition payment processing terminals and credit, debit and other payment cards to employ enhanced security features, including chip-and-PIN technology. The President also announced that a number of large national retailers simultaneously pledged to enact similar secure chip and PIN-compatible card terminals in their stores. Many of the retailers have pledged to implement the new chip and PIN technology by January 2015.
The President’s stated goal is to drive the market to adopt stronger data security measures by leading the way with more secure government retail transactions. Microchip technology is desirable because it is more secure than unencrypted magnetic strips for credit and debit card payments.
Many of the large retailers that pledged to follow these security measures will implement heightened technology in the new year. Banks have started issuing chip cards to customers with lost, stolen or expired cards. During this holiday shopping season, retailers have reported that they are working to improve their existing transaction monitoring and authentication technology, such as strengthening usernames and passwords and encrypting data on their networks.
For a copy of the executive order, Improving the Security of Consumer Financial Transactions, please click here.