NEW YORK: Some 50 big US retailers are refusing to use Apple Pay, Apple’s new electronic payments service. Rather they are working on developing their own payment system, called CurrentC, through the Merchants Customer Exchange (MCX) consortium. It would bolster their profits by eliminating transaction fees on credit cards.
Major credit card companies unveiled a strategy over a decade ago to fight hackers. Those security tests have failed to stop the growing number of cyber attacks against retailers this past year. Two of the biggest retailers to get hacked–Home Depot and Target–say they passed the security tests before hackers stole the debit and credit card data of a combined 96 million consumers from their computer systems.
The share of U.S. companies that pay their suppliers by credit card has doubled in the past two years. An estimated 10% of this year’s business-to-business purchases will be made with credit cards. As companies struggled out of the credit crisis, many sought the extra 30-day float and perks that credit cards offer, and wrote fewer checks. Plus, using a business credit card also can increase fraud protection and lower processing costs, especially on small purchases.
Americans travelling in other parts of the world are sometimes bewildered to discover that their debit or credit cards don’t work at automated kiosks that use new chip and PIN technology rather than magnetic stripes. EMV cards have been the standard in Canada, Europe and other parts of the world for several years now, but they’re not as widely used in the US that’s likely to change next October, when liability for fraud shifts from US card issuers to merchants if merchants don’t upgrade their payment terminals to properly accept chip-based cards. Some smaller merchants may be slow to adopt the new technology if they feel it’s less expensive to assume the fraud risk than update their payment terminals.
