The change from credit cards that you swipe to chip-enabled ones that you dip is expected to accelerate as an Oct. 1 deadline approaches that will make merchants liable for fraudulent charges if they don't accept the more secure chip cards.
But most American credit card holders aren't ready for chip cards. Six out of 10 credit card holders still don't have a chip card, according to a new survey by CreditCards.com.
Neither are merchants. BridgePay Network Solutions, a payments software maker, estimates that only 5 to 10 percent of U.S retailers are prepared to accept chip cards, known in the industry as EMV cards, named after EuroPay, MasterCard and Visa that created the technology standard. Consulting firm Ovum found that 36.8 percent of merchants it surveyed have no interest in adopting EMV in the future and estimates more than 5 million businesses aren't ready for chip cards.
The liability shift, which is being imposed by the credit card industry itself, will make most U.S. merchants liable for any fraudulent transactions if their credit card readers do not accept EMV card payments. Previously, credit card issuers were the ones liable for any fraudulent transactions. Regardless, consumers won't be on the hook for the fraud.