BuySecure Initiative speeds chip-enabled payment cards
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The move is designed to increase the security of financial transactions by requiring the use of microchip-enabled credit, debit and other payment cards by agencies.
Last week, President Obama signed an executive order, Improving the Security of Consumer Financial Transactions, designed to increase the security of financial transactions by requiring the use of microchip-enabled credit, debit and other payment cards by agencies.
With the new BuySecure Initiative, the administration aims to improve the government’s payment security “as a customer and a provider,” and encourages the commercial sector to follow its lead by moving to stronger security technologies and developing next-generation payment security tools.
These chip-and-PIN cards, based on the EMV standard, use embedded chips to enable more secure credit card transactions than is possible with consumer ATM cards that use magnetic strips and personal identification numbers.
Named after its original developers (Europay, MasterCard and Visa), EMV cards use embedded microprocessors that store and protect cardholder data. Unlike magnetic stripe technology, EMV cards also support dynamic authentication, which protects data by generating a unique transaction code each time an EMV card is used for payment.
The use of a PIN and cryptographic algorithms authenticate the card with a processing terminal and the card issuer's host system. EMV cards and terminals confirm the identity of the cardholder by requiring the use of a PIN rather than signing a paper receipt.
On a magnetic stripe card, the data is static and can be easily copied with a “simple and inexpensive card reading device,” enabling criminals to reproduce counterfeit cards, according to ChasePaymentTech.
The federal government will use the chip-and-PIN technology for government credit cards, as well as debit cards like Direct Express, the Treasury-recommended prepaid debit card payment option for federal benefit recipients who don’t have a bank or credit union account.
The executive order also requires upgrading retail payment card terminals at government locations like passport offices and national parks so that they can accept chip and PIN-enabled cards.
The administration’s enterprisewide transition to more secure payment cards will ensure the security of doing retail business with the government, but also, through increased demand, help drive the market toward swifter adoption of stronger security standards, the White House said.