It’s no secret that magnetic stripe credit cards are looked down upon in Europe. At this time last year, I experienced frustration when traveling in London and merchants were extremely distrustful of my American credit cards. Their chip-and-PIN cards have become such the norm there that any magnetic stripe-only card is under suspicion, as they lack that extra layer of security. Our cards are still widely accepted there; they just come under more scrutiny due to the higher potential for fraud. In several of my encounters, the merchants had us sign our names on receipts over and over again until they perfectly matched the signature on the back of the card.
Many credit card terminals in Europe still have functionality to accept payment from mag stripe cards, but the cashier usually has to do it manually. Most automated payment systems, such as unstaffed train stations or petrol pumps, only accept chip-and-PIN cards. European credit cards still have magnetic stripes so that they can be used when these folks travel to the U.S., but the bankers aren’t wild about it since it exposes them to the type of fraud that they try to prevent.
Last May, I wrote about the announcement that America’s first chip-and-PIN card was coming, and now, it has arrived. A Europe-compliant chip is a feature offered by the Elite card from the United Nations Federal Credit Union. It’s not exactly a card for the masses, though. UNFCU limits is membership to “United Nations staff, UN Specialized Agencies, former international civil servants and their families globally.” So it’s a specialty product reserved for jet-setting diplomats.
We better get cracking, guys. On Jan. 31, the European Payments Council, which sets standards for payments, took another step toward making American style, mag-stripe-only cards obsolete. The council passed a resolution saying the “use of magnetic stripe be restricted to exceptional cases” and allows banks to “refuse magnetic stripe transactions if they so wish.”
Chip-and-PIN technology just doesn’t seem to be on the priority list for American credit card issuers. As Bob Sullivan, over at MSNBC’s fine blog The Red Tape Chronicles, points out, we may just skip over the chip-and-PIN technology and adopt something even smarter and safer. Until then, Americans in Europe and Europeans in America can still make purchases in each other’s countries — they just need to prepare for potential headache. I look forward to seeing what the future brings! What are your predictions?
Please read on for my roundup of my top 10 favorite personal finance blog posts from the past week!
1. Guilty of blowing too much cash on deal sites like Groupon and LivingSocial? Me too. WalletPop offers 11 ways you can resist spending money on these sites.
2. Almost Frugal discusses the difficulty of digesting global tragedies and explains the overall lessons she’s learned from recent events, in addition to what it has to do with frugality.
3. Brip Blap explains why there is nothing wrong with wanting to be wealthy, especially since it enables you to help others even more.
4. Soldier of Finance compares credit scores to roster numbers that military recruits are given in basic training.
5. We can tell you that it’s not always a simple process. Couple Money provides tips for selecting the best credit card for your needs.
6. In light of the disaster in Japan, MoneyNing lists which financial documents you need in a disaster and what you should do to prepare.
7. Debt Free Adventure tells readers what a debt score is and why it matters.
8. Gather Little by Little teaches the basics of setting up a budget and sharing it with your family.
9. A guest post on Bucksome Boomer discusses a study showing debt concerns amongst Baby Boomers, plus tips for getting out of credit card debt.
10. Cash Money Life lists seven steps you should take if you need to boost your credit score.