Why your credit card won't work here

When we opened our bank account in Belgium, you may remember me mentioning in a blog post that I asked our banker if we would be issued a checkbook . . . her confused look prompted me to pull out my American checkbook.  After looking at it curiously for a moment or two, she said "we haven't had those in 15 years".

Make that 20  years now.

When we were home for our Christmas visit we did a little shopping.  It was really the first time we'd done much shopping in the States since about 2 years ago.  It surprised me that I would have to sign my name on credit card receipts.  I had completely forgotten about this.

In Belgium and 80 other countries in the world, except the U.S. and maybe one country in Africa (seriously), uses a microchip, like the one pictured above, on credit and debit cards.  No signature required.

From what I understand, with a microchip, the information is encrypted differently for EACH transaction and very difficult to hack.  

The U.S. and maybe one country in Africa (seriously :), uses the magnetic strip like the ones that are probably on your cards.  The information is NOT encrypted, it is the same on EVERY transaction, and very easy to hack. Case in point - Target.  

Only 1% of credit cards in the U.S. currently have this technology.

According to security specialists, the magnetic strip is about the worst security you can have in a payment system.  Plus the fact that it's pretty outdated.

More than a decade ago, Europe went all microchip.  Every grocery store, gas station, pharmacy, restaurant, boutique and bakery in every country we've visited has one of these handy gadgets (large grey thing in front of cashier) to scan your credit or debit card - both requiring a PIN code.

Although they've been common throughout Europe since the mid-90's, the first mass use of these cards was in pay telephones in France in 1983 - thirty years ago!

If you've never seen one of these, hopefully you will soon.  When I want to access my bank account or pay the light bill or buy something online, I use a "card reader" like the one above.  It's issued by my bank and it takes me through several steps to insure the security of my payment or purchase.

Interestingly enough, I read that Target tried to collaborate with Visa more than 10 years ago for the microchip cards, but executives shelved it due to fear checkout time would take longer.  Really?

Now, I do it all - I insert my card in the machine, I put in my PIN, one receipt is printed and I'm done.  

Before, I handed my card to the cashier, they swiped it, they printed a receipt, I signed it, they kept it and another receipt was printed for me . . . then I was done. 

Surely there was more to the Visa and Target discussion than that.  My guess is it had a lot more to do with issuing a bazillion new cards and every boutique and bakery getting one of those handy grey gadgets.  

The good news is the U.S. is finally getting on board (not sure about that one African country). Americans should see a change beginning this year with microchip encrypted cards being issued.  It'll take some time before every grocery store and gas station has one of those handy grey gadgets, but . . .

better a decade or more late than not at all.

Even Winslow has had a microchip for the last 5 years.  

He is definitely invaluable, but as far as I know, he is not tied to our bank account :-)