The Simon Tonekham Statesman

As the Canadian Dollar is soaring to unprecedented levels along with the increase in online and cross-border shopping, there isn’t a common and fool-proof payment option to pay stuff online without the use of a credit card. The reason, you are more prone to increased security risks on giving out your credit card information online and your risk gets increased further as someone has no permission from you using your credit card.

For me, I have a credit card but I’m not willing to take that risk. I do have a bank account but these days most financial institutions in Canada – notably RBC Royal Bank, Scotiabank and TD Canada Trust offer paying your purchase online using your bank account (dubbed Interac Online) – but at Canadian companies only offering the service. My bank (that I have an account there) in particular does not offer that service as to maintain its no-fee system.

It’ll be years (or decades, or worse – my entire lifetime) until a common and fool-proof payment system is developed so we could take an opportunity on paying the stuff online we always wanted.

In other related things, Chip Cards (the ones with a microchip embedded on them) are starting to gain momentum in Canada. As I speak, a trial is being conducted in the Kitchener-Waterloo area and it’s ongoing as I speak. This marks the first time that the chip card system for paying things is gaining the ground since the failed Mondex pilot project in Guelph (Ontario) and Sherbrooke (Quebec). In the next three years and more, we will see more and more chip cards on the hands of Canadian wallets and eventually reduce the risk of fraud once and for all. Europe was able to successfully reduce the number of card fraud in unprecedented numbers. All you need is to insert the chip card on the reader, confirm the amount and enter your PIN number. Once that’s done, you will be notified that the transaction has gone through or not. If it has, you can take the card out of the reader. It’s simple as that.

This is what a chip card looks like:

Over the coming years, we will see more and more chip cards going into circulation and more bank machines and PIN pads equipped to handle chip cards. It’s worth the wait for me, but if the system was implemented today, I would take advantage of it.

Further reading:

http://www.cnw.ca/en/releases/archive/October2007/16/c4259.html

http://www.cnw.ca/en/releases/archive/September2007/12/c8161.html

http://www.cnw.ca/en/releases/archive/October2007/16/c4609.html

A video on how the chip card works and interviews by various people

Interac’s web page about the chip card

www.chipmigration.ca – website about the Kitchener-Waterloo pilot project for chip cards

UPDATE: article from the Guelph Mercury about the comeback of the chip card pilot project: http://news.guelphmercury.com/Business/article/255038

Although not related to my topic, there is a web page about Interac’s new campaign dubbed, “The convenience of the debit network”: http://www.marketingmag.ca/daily/20071106/national1.html Every time I see that commercial, I literally cried.