The top attorney for the powerful National Retail Federation blasted banks and credit card companies on Tuesday for problems and costs with the massive ongoing U.S. rollout of computer chip cards and chip card readers.

Mallory Duncan, general counsel for the NRF, said computer chip cards will initially require customers to provide a signature, instead of a distinct PIN (personal identification number), which won’t eliminate online and phone fraud with a stolen or lost chip card.

He also said the financial burden — now in the tens of billions of dollars — of making the transition to chip card technology unfairly rests mainly with retailers, not banks and credit card providers.

“We and our customers should not bear the burden for flaws in a 50-year-old [magnetic card] system,” Duncan said in a conference call with reporters on Tuesday. The transition to chip cards and chip terminals has “been all stick and no carrot and [the technology] doesn’t work… We would like it to work and we want a secure payment system.” The NRF is the largest retail association in the world, with 18,000 members.

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Time For Truth: (CSO Onine) – Retail group rips chip-card conversion expense, pushes for PIN security

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