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Posted: 6:00 a.m. Wednesday, Feb. 12, 2014

Chip and PIN is coming to the U.S.

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By Clark Howard

In the wake of the Target and Neiman Marcus breach, we're finally getting on board with the chip and PIN security standard used the world over.

The United States is the only developed nation that has not adopted the chip and PIN standard in our credit and debit cards. We're still using magnetic strip technology from the 1960s; that's why crooks target U.S. payment systems for hacking.

If you've not seen the chip I'm talking about, it's a little silver shiny thing that is about a third of an inch square. That chip means that even if a crook can capture your card info, they can't duplicate the card.

When you use a card with chip and PIN, you’re required to punch in a secret code at checkout, rather than signing for a transaction.

Now the banks that control the bulk of our nation’s credit card portfolio have signaled their intent to switch over to chip and PIN by 2015, according to The Wall Street Journal.

When your credit card renews later this year and you get a new one in the mail, it will likely have a chip in it. If not by this year, then certainly by next year.

Meanwhile, the other fallout from the Target breach has to do with real estate transactions.

If you were involved in the breach, your credit goes kerflooey as crooks apply for credit in your name. That is effectively shutting down refinances and mortgage applications, according to The Los Angeles Times.

I’ve always said do not freeze your credit if you’re about to buy a home or do a refinance. But now I have to reverse that advice; doing a credit freeze can be especially valuable now if you plan to buy or refi in the next few months.

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