WA5

Chip and Pin system provokes mixed reactions

As the new Chip and Pin payment system spreads across the UK, the scheme is receiving mixed reactions from retailers.

Under the new system, when cardholders purchase goods using a credit or debit card, they are required to type a four-digit pin number into a key pad, rather than signing a receipt.

The Chip and Pin system aims to ease the growing problem of credit card fraud, which costs the UK millions of pounds every year.

Two in every five cardholders in the UK now have Chip and Pin cards.

However, a recent survey has suggested that more than 20% of medium-sized retailers are not intending to upgrade to Chip and Pin until their retail terminals are due for replacement.

56% of those questioned raised concerns about the difficulties of changing to the new system, partly because of a lack of clear guidance.

From 1 January 2005, retailers who comply with card issuers’ instructions under the new system will be covered in the event of fraud.

However, those choosing not to adopt the Chip and Pin system will be held responsible for any ensuing losses.

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