Katherine, Twitter asked:
Why do US banks not use chip and pin?
Steven - So, US banks currently donít use chip cards, but they are increasingly doing so. The main reason they are not or up until recently is not a technical reason, but economic. The US banks make more money when a customer signs for transaction, rather than enters in a PIN and it got so ridiculous that a US bank, which was also had UK branches was saying to their UK customers, use the PIN its safer and telling their US customers pen not PIN, signature is safer.
I read a recent article in The Economist where they claimed that a main reason for the lack of an upgrade is that the US card companies estimated the cost of upgrading was higher than the expected savings from a reduction in fraud. jpetruccelli, Wed, 5th Sep 2012
Personally I've always thought that signatures are pretty foolish as one should be able to get a forgery close enough to fool all but the most astute experts.
The chips are under a cent each in volume, so this adds very little cost. Replacing a few million terminals though will cost. At present the card and sign puts the onus on the merchant to verify the signature ( though very few do) while Chip and pin puts the onus on the consumer. The winner in both is the bank, the cost of fraud is either borne by the merchants or the card owner, not the bank. SeanB, Wed, 5th Sep 2012
Here's the article: http://www.economist.com/blogs/babbage/2012/02/credit-card-security