Target: Yep, They Made The Worst Decision Imaginable

In the most ridiculous decision possible, Target have agree to ACCELERATE their ‘smart card rollout’ to the tune of about $100M;

Target to accelerate $100 million chip-enabled smart card program: CFO, Reuters, Feb 03, 2014

Let me say that again; ONE HUNDRED MILLION DOLLARS!

How exactly are these new smart cards (which is EMV / Chip & PIN obviously)  going to reduce “cyber theft” when they do absolutely nothing except prevent card present fraud? It’s not as though this amazing chip-enabled technology actually encrypts the cardholder data point-to-point (that’s a terminal function, if available), so it doesn’t stop Target saving the data post-auth. And because not ALL US retailers and merchants are going to accelerate THEIR programs, Target have done nothing to prevent the real menace; card NOT present fraud.

What are they going to do when their customers start demanding other forms of payment, like mobile? Or when they start losing market share because value-add services won’t integrate with their shiny new static-function payment terminals? Spend ANOTHER $100M?

I’ve said it a hundred times, payments is NOT about the payment functionality itself, it’s about the AUTHENTICATION of the individual trying to MAKE the payment. In that, Target are completely missing the point.

If this is pressure from the card brands shame on them, if it’s pressure from ‘Government regulators’, shame on THEM, but if this is just Target being short-sighted and throwing good money after bad, then I hope their share-holders wake up before it’s too late.

I for one would be really pissed if had a vested interest in this.

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