2010 may be remembered as the year Chip and PIN payment cards came to America. With five days still left in May, two important events happened to change the payment industry in the U.S. forever.

Last week, at the Smart Card Alliance Conference, Wal-Mart announced its deployment EMV (or Chip and PIN) compatible card readers in all of their U.S. stores. Wal-Mart’s reason for the upgraded readers was simple- to stop fraud. While deploying the new card readers might seem premature, since major U.S. card issuers have yet to start issuing Chip and PIN payment cards, the proactive move by Wal-Mart shows card issuers that retailers want to move to Chip and PIN. If the largest retailer is willing to deploy these readers in all of their stores, maybe more retailers will follow suit.

Equally of interest, earlier this month, the United Nations Federal Credit Union (UNFCU) announced they would begin offering customers Chip and PIN payment cards. UNFCU is the first U.S. card issuer to offer the globally accepted, more secure chip enabled payment cards. The Credit Union cited that many of their members are frequent travelers and/or live in multiple countries; a Chip and PIN card would be a great convenience for them. Further they explained the benefit to their customers of providing them with a more secure card would engender greater customer loyalty.

Unfortunately, when these card holders use their new Chip and PIN cards in the U. S., retailers will still read the magnetic strip legacy technology, not the secure Chip and PIN. Obviously, the one exception to this will be Wal-Mart. In order to address payment fraud in the U. S., there needs to be a wide-spread adoption of Chip and PIN cards and readers, by issuers and retailers.

Any transition to a more secure card cannot happen among only a small group of America users, but needs to happen within the broader U.S. population. Both issuers and retailers across the country need to accept the facts:

1. Fraud is on the rise and costs the banks, retailers, and customers money.
2. We can pay now to upgrade our electronic payment system to Chip and PIN or we can pay for the increasing cost of fraud that is exploiting our antiquated system.
3. Card issuers can gain customer loyalty by issuing secure Chip and PIN payment cards to their customers, enabling them to protect themselves from identity theft, scams, and fraud.

The Secure ID Coalition applauds the recent deployments by Wal-Mart and the United Nations Federal Credit Union in an effort to finally bring secure payment transactions to the U.S. Other issuers and retailers in the U. S. need to follow their lead to protect the payment infrastructure and customer identity information.