Target Is Back on the Chip-Based Credit-Card Technology Train
In the wake of the large-scale security breach suffered by Target Corp. (NYSE:TGT) over the holiday season, the No. 3 U.S. retailer is showing signs of a renewed readiness to adopt chip-based credit-card technology that better protects shoppers. Many stores and retailers in Europe and Canada already use chip-based credit cards – those with a smart chip in the card that works with special readers installed at stores — but the U.S. has been slower to adopt the technology, and surprisingly, some of that blame is on Target.
The Wall St Journal elucidated in a report Monday that Target has contributed to the delay in progress on chip cards in the U.S. because it, along with its fellow retailers, have been unable to compromise with the financial industry over card-swipe fees and other issues. Back in 2004, executives in Target’s credit-card division worked to jumpstart a 3-year program involving chip-based credit cards, but the retailer’s executives responsible for store operations and merchandising ultimately halted the program on account of worry that the technology would slow checkout speeds and didn’t offer sufficient marketing benefits.
CEO Gregg Steinhafel was one of the executives part of that the anti-cards camp a decade ago, but now, the chief executive appears to be more in favor of the cards. He said during an interview on January 13 in regards to the mass adoption of chip cards that, “I think we’re ready to move.”