Stopping credit-card fraud with high-tech

Retailer target did not experience its best holiday shopping season ever. Hackers were able to obtain information on 40 million consumers who used their credit cards at the retailer’s stores in November and December. Now the company faces lawsuits and negative press. But a recent report from CBS Minnesota provides hope: According to the story, technology might soon make such credit-card hacks much less common.

Waiting for smart cards

What would help? CBS Minnesota points to smart cards, which are already popular throughout much of Europe. These credit cards, which store all of a consumer’s accounts on one card, use microchips and PINs, which makes them far more secure than the low-tech cards consumers in the United States use. Smart-card data breaches hardly ever happen. Sadly, it might still be a few years before these high-tech cards arrive in the United States.

Who’s that masked card?

There is also what is known as masked cards, which CBS Minnesota reports are already available in the United States. Whenever consumers use one of these cards, it gives a temporary number that cashiers type in or that consumers can use while shopping online. The temporary number then disappears once a transaction is completed. Consequently hackers can’t use it, even if they steal it.

Why the delay?

Of course, smart cards would be ideal. It might take a few more years, though, for those to arrive in the country. No one knows why smart cards aren’t here already. But CBS Minnesota’s story speculates that one of the factors may be that credit-card companies haven’t yet upgraded to the modern technology that they would need.