The National Retail Federation sent a letter to Congressional leaders Tuesday supporting chip-embedded cards and blaming financial institutions' continued reliance on magnetic stripe cards for the latest wave of payment data breaches.
The magnetic stripe cards are generally considered far more vulnerable to fraud than cards embedded with computer chips, particularly when those cards also require the use of a PIN.
"When it comes to the most criminally lucrative data—sensitive bank card information—our partners in the financial sector have a critical role to play in making sure their cards are secure,” the National Retail Federation wrote in the Jan. 21 letter to House Speaker John Boehner (R-Ohio) and Senate Majority Leader Harry Reid (D-Nev.). “For years, banks have continued to issue fraud-prone magnetic stripe cards to U.S. customers, putting sensitive financial information at risk while simultaneously touting the security benefits of next generation 'PIN and Chip' card technology for customers in Europe and dozens of other markets.”
The NRF also used the letter to support the Cyber Intelligence Sharing and Protection Act (H.R. 624) which would enable retailers to quickly share information about threats, and called for federal legislation that would establish a single, national, standard and procedure for how card data security breaches are to be handled.
“A preemptive federal breach notification law would allow retailers to focus their resources on complying with one single law and enable consumers to know their rights, regardless of where they live,” the Federation wrote, after noting that 46 states currently have different data breach laws on their books.