Obama Announces Plan to Tighten Debit Card Security

Obama Announces Plan to Tighten Debit Card Security

On Friday, President Barack Obama revealed a government plan to tighten security for the debit cards that transmit federal benefits such as Social Security to millions of Americans.

Cards issued by the federal government now will contain an internal chip replacing magnetic strips to decrease the possibility for fraud.

Concern is increasing over the security of Americans' financial data. According to estimation, about 100 million people have been affected by breaches in the past year, including at big retailers like Target and Home Depot.

According to Obama, to replace signatures to all accessible and newly issued government credit cards, the government will apply the security chips and personal identification numbers (PINS).

Payment terminals at federal government facilities will be set to manage cards with the new technology.

The idea of the government program is to push the broader financial industry and retailers toward more safe standards.

Obama mentioned that Home Depot, Target, Walgreens and Wal-Mart Stores plan to install payment terminals in their stores set to manage cards with digital security chips and PIN.

Obama also mentioned a plan by American Express to help small businesses that improve their payment terminals with more safe standards and a program by payments processor Visa to notify consumers and merchants about the new technologies.

Obama's executive order also tells the government to take new measures to aid victims to identity theft. To report about identity theft and remedy errors with credit reporting, the Federal Trade Commission will make a new website for consumers.

"More than 100 million Americans had information that was compromised in data breaches in some of our largest companies, and identity theft is now America's fastest-growing crime", said Obama in a speech detailing his executive order and other cyber security measures.

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