Smart Cards Stop Fraud and American Tourists
American credit cards are lacking a vital element that is likely to make them useless in many foreign countries. The important missing element in American cards is smart card technology.
Smart cards still provide a magnetic strip that makes them compatible with older terminals but they also have an embdedded microprocessor that provides the smart technology. Smart cards have been adopted for use in over 22 countries including most of Europe, Mexico, Brazil and Japan and more countries are migrating towards using the technology. It is anticipated that the next two years will see China, India and most of Latin America embrace this new, high security feature.
The embedded microprocessor means that more data can be stored on the card instead of relying upon database access. The new smart card technology is favoured by the police and government as it makes it so much more difficult to clone credit cards and commit card fraud.
The new technology isn’t too much of an issue when making purchases in stores or paying restaurant bills as most of these merchant terminals still rely on magnetic strips. However, there are an increasing number of automated terminals, at ticket kiosks and gas pumps, that require the use of a new smart card. Americans who don’t have cards with the new smart card technology would not be able to make use of these new facilties.
Although the rest of the world is quickly adopting the new, high security technology the American banking industry has no immediate plans introduce the new cards. It has been observed that credit card fraud isn’t as big a problem in the United states as its in Europe and other parts of the world.
Another crucial reason for the delay in adopting this valuable new technology is the cost of introduction. It has been estimated that it would cost around $5.5 billion to introduce the required technology most of which would be spent on the new terminals needed by merchants.
So if you’re an American headed for Europe or elsewhere in the near future the answer is to make certain that you always have some cash in your pocket.
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One thing you can be certain of when travelling is the need for adequate and appropriate travel insurance. If you are retired or over 64 you will probably want to consider Senior travel insurance and if you have a medical condition you would be wise to consider pre existing medical travel insurance.
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