IT World Canada

With a trial in Kitchener-Waterloo making progress, executives say the rest of Canada is sure to follow

By: Rafael Ruffolo – ComputerWorld Canada (16 Apr 2008)

Members of the payment card industry – including Interac Association, MasterCard Canada Inc., Visa Canada, and virtually every major Canadian bank – announced Tuesday positive preliminary results for the industry-wide chip and PIN trial in Southern Ontario.

The new verification technology, which is being rolled out in Kitchener-Waterloo by banks like TD Canada Trust and Royal Bank of Canada, will equip all credit cards with a chip and PIN number. When a customer wishes to pay for goods they can place the card into a “PIN pad” terminal and verify payment by entering the PIN. This will replace the traditional need for signature verification and would also require customers to hang on to their cards at all times – as opposed to today’s practice in certain environments such as restaurants, where their cards are often swiped out of sight.

“From a liability shift perspective, if a chip-enabled card is used at a chip-enabled terminal, the issuer will still be responsible for the fraud,” Black (Tracey Black, program director at the Kitchener-Waterloo Industry Chip Trial) said, “But if the chip-enabled card is used at a terminal that has not been upgraded for chip, then the fraud becomes the responsibility of that merchant. As long as the merchant upgrades to chip, they have no liability for any transactions that occur at a point-of-sale terminal with chip-enabled PIN cards.”

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