In recent months, many of the nation’s largest credit card lenders have begun issuing a new type of credit card to certain customers in hopes of easing their ability to complete purchases when traveling overseas.
JPMorgan Chase, one of the earliest among the nation’s top credit card lenders to begin issuing “chip and pin” credit cards to frequent travelers, is now offering another such account, according to a report from the Associated Press. The latest card, co-branded with British Airways, is designed to give consumers greater flexibility when making foreign purchases.
Nearly all credit cards ever issued in the U.S. use a magnetic strip on the back of the card to store consumers’ payment information – technology that was cutting edge decades ago but has long since fallen obsolete – the report said. And while that is still the norm here, all other major industrialized countries in the world have switched to a more secure system, one which stores information on a microchip embedded in the card and requires the user to enter a code when making a purchase, as they would with a debit card.
The result of the global change is that now, a few years after widespread adoption of the chip and pin system, a growing number of Americans are finding it difficult to complete some overseas transactions with their U.S.-issued credit cards, the report said. The most common way in which consumers have had these difficulties is when using automated machines such as gas pumps or those for train passes.
“What used to be a trickle a few years ago has become a frequent point of irritation,” Naney Pandit, general manager of Chase’s card services, told the news agency.
Already, a number of American financial institutions, such as Bank of America, Wells Fargo and U.S. Bank, have begun offering the more secure payment option to wealthier travelers who tend to travel overseas more often, the report said. Many of these cards carry sizable annual fees.
Chip and pin credit card technology is safer than magnetic strips because it’s harder to obtain information stored on the card, and even more difficult to duplicate, making it tough on thieves to rack up fraudulent credit card debt in other people’s names.