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article imageTarget CEO: Banks need to issue chip-based credit cards in U.S.

By Michael Krebs     Jan 25, 2014 in Business
With the FBI now warning all retailers on similar breach possibilities, Target CEO Gregg Steinhafel is refocusing attention on the need for chip-based credit card technology adoption in the United States.
The data breach headache that has been unfolding since Christmas at Target Corporation (TGT) is more a matter of modern credit card technology adoption by card-issuing banks than it is a manageable security issue at the retailer level. At least this is the position of Target CEO Gregg Steinhafel, according to a Wall Street Journal report.
Steinhafel's comments come during a week that saw investors punish Target Corporation's stock, driving its price to a new 52-week low on the data breach news and the prospect of the data breach hurting future sales at the retailer. Target Corporation is the third largest retailer in the United States.
The insistence by Steinhafel on the need for chip-based credit cards in the United States is not without merit. Chip-based credit cards are used widely in Europe and Canada, and credit card thieves and cyber criminals routinely target U.S. retailers and institutions as a result.
This past week, as the Chicago Tribune reported, the FBI warned U.S. retailers to expect more data breaches, highlighting the fact that this is not a concern unique to Target Corporation.
Retailers and banks have been debating the issue of chip-based credit card implementation for a long time, and the two industries have not been able to agree on footing the billions of dollars necessary to convert to the more secure technology.
"All of us have a common interest in being protected, so this might be a chance for retailers and banks to for once work together, as opposed to sue each other like we've been doing the last decade," James Dimon, CEO of J.P. Morgan Chase, said during an earnings call, as the Wall Street Journal reported.
More about Target, Credit cards, Cybersecurity, Data breach, Credit card fraud
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