[andrewfong]

Because it's not worth the cost. On the consumer side, chargebacks are easy. Credit card companies bear the brunt of the cost of fraud. They all have the incentive in the world to start rolling out chip and pin technology. The fact that they haven't probably demonstrates that the math doesn't work out.

[silviogutierrez]

It's actually the end merchant (seller) that bears the cost of fraud. So credit card companies have little incentive to fix this, beyond customer support costs.

Say you sell a camera to someone using a stolen credit card.

The real owner of the card gets his money back after doing a chargeback. The thief keeps the camera. The merchant loses a camera, the money, and gets a ding in his credit card merchant reputation.

[andrewfong]

Seems like the legislative solution then would just be to shift (at least some of) the burden to the credit card processors then.

[silviogutierrez]

I agree. It's a tricky problem. Chargebacks are really easy for the consumer - too easy. There has to be a happy medium, but I can't quite think what it is.

Bitcoin, on the other hand, is sided on the other extreme. The merchant has almost all the power. However, the merchant still has a reputation, which might be sufficient incentive.

[largote]

Doesn't the merchant bear the cost of the fraud ONLY if they'r e using obsolete equipment?

[fragmede]

> Because it's not worth the cost.

Neither are airbags in cars, yet the government stepped in and made them mandatory.

> [Credit card companies] all have the incentive in the world to start rolling out chip and pin technology.

No, their incentive is to make sure people keep using credit cards.

They've done the math and concluded that the amount of user confusion resulting from chip and pin technology resulting in less credit card use is less than the cost of fraud. The fact that chip and pin works in Europe, and also that credit card processors still exist in Europe proves that implementing chip and pin isn't going to drive Visa and Mastercard out of business.

[serf]

>> because it's not worth the cost.

> Neither are airbags in cars, yet the government stepped in and made them mandatory.

that's simply untrue.

http://www.riskworld.com/news/97q1/nw7aa029.htm

this testimony is from 1997, and even with mostly first generation airbags in play at that time it's still wrong.

They are even more effective at saving lives now, and many of the problems with passenger side airbags have now been alleviated.

saved lives = saved money (unless you're looking at cost-to-state of an entire life rather than cost-to-state for medical/funeral costs, but that's outside the scope of this)

[chrislipa]

Dead customers can't be returning customers?

[JohnTHaller]

Merchants bear the brunt of the cost of fraud. Credit card companies and consumers bear none. And as the credit card company oligopoly currently* has no viable replacement, merchants are stuck bearing the cost of fraud.

* the replacement will be when folks like Square, PayPal, etc grow large enough that merchants can replace credit card systems with them for a decent % of customers