Payment Processors Have Set the Date: U.S. Credit Cards Will Change to Chip-n-PIN by 2013

Last August, payment processor Visa announced that all of their acquirer processors in the United States, along with all of their U.S.-based sub-processor service providers are required to equip themselves to be able to support merchant transactions initiated by chip-and-PIN payment cards by April of 2013.

Just recently MasterCard followed Visa`s precedent, announcing its intent to ease American consumers into using the chip-and-PIN technology by the same date, while making assurances to have the necessary payment infrastructure in place in time.

Chip-and PIN, or "EMV," payment card technology has been prevalent in Europe for quite some time now. Garnering its name from the payment process - a consumer presents their card at the point of sale, where data contained in the embedded chip is scanned by special readers then the customer, instead of signing a receipt, enters in a unique 4-digit PIN number to complete the transaction - chip-and-PIN cards in the hands of American consumers will make it much less troublesome for overseas travelers to use their credit cards on foreign soil.

"EMV" stands for Europay, MasterCard and Visa, which are the three providers of payment infrastructure that adapted the chip readers to an interoperable standard. Since then, Europay has merged with Mastercard.

"We`re moving toward a world beyond plastic, where consumers will shop and pay in a way that best fits their needs and lifestyles with a simple tap, click or touch in-store, online or on a mobile device," said MasterCard`s president of U.S. markets Chris McWilton, according to the online news source pcmag.com.

Visa also claims to be making adjustments in anticipation of a future wherein consumers will pay for purchases made in stores and via the Internet by using a mobile device such as a smartphone or a tablet. Visa has even gone so far as to promote such wireless technology by endorsing the near-field technology Google is utilizing for their recently-launched Google Wallet. MasterCard has yet to do something similar.

"Our roadmap represents a transformational shift in the approach to payments and is not simply about EMV, chip and PIN. We`re focused on readying the ecosystem to drive future innovation and provide new consumer experiences to enhance the value of electronic payments," stated MasterCard`s McWilton, as reported by pcmag.

Bryant Park

Bryant Park is a financial consultant for one of the companies listed on Wall Street. He writes on a variety of topics ranging from credit cards to different loans that can be availed by consumers. He holds a bachelor degree in Financial Services from Dartmouth College.