Slideshow 'Chips Are Not Silver Bullets': Comments of the Week

  • December 11 2015, 7:30am EST

American Banker readers share their views on the most pressing banking topics of the week. Comments are excerpted from reader response sections of articles and our social media platforms.

In response to an op-ed championing chip cards, regardless of whether they are used with signatures or PIN codes:

"Chips are not silver bullets. In fact, they are hazardous because they carry unencrypted primary account data. Until that changes, fraud will continue unabated."

Related Article: In EMV Debate, Chip Matters More than Anything Else

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A reaction to a new CFPB report that still found significant problems in the credit card market:

"CFPB likes to cherry pick its data points to make a case. Both the reduction in default rates and increase in credit availability is a function of the economic and credit cycles, not the beneficial effects of regulation. To the extent that the CARD Act impacted defaults, it is because higher risk consumers have less access to cards as a result of the elimination of certain income sources."

Related Article: CFPB Warns of Flaws in Credit Card Market

A response to TD Bank coming under fire from a New York City official for doing business with gun manufacturers:

"This is really going too far! TD bank is not saying they are supporting guns by just lending money to a valid business. A bank should not be put in a position to choose who they lend to as long as they are legal, tax paying companies. I do think we need gun control but having the banks cut off funding is a far stretch from establishing … controls on who owns weapons of mass destruction."

Related Article: N.Y. Politician Goes After TD Bank for Lending to Gun Maker

Questioning an op-ed highlighting the reasons why consumers feel burdened by overdraft charges:

"How about telling people not to write bad checks or make a promise to pay they can't keep."

Related Article: Who Says Overdraft's a Burden? Consumers Do

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In defense of overdraft restrictions:

"I'm surprised to see anyone defending transaction reordering. And how many customers really want a debit transaction to be silently approved at a cost of $35? Sleazy and sneaky. Banks can do better than the ethics of cable companies and car dealers."

Related Article: Who Says Overdraft's a Burden? Consumers Do

On a move by Green Dot, which had previously stated its firm belief against raising fees, to reverse course and charge a higher fee:

"So much for 'religious conviction.'"

Related Article: Green Dot Reverses Course, Raises Fees on Prepaid Cards

On the idea of using social media data to underwrite consumers:

"This sounds instinctively true, but lenders should obtain empirical data to demonstrate how analytics of social media can predict creditworthiness before chucking credit scores, particularly how the methodology will perform in periods of economic distress. Otherwise, it's just tea leaf reading. Also, how do you deny a loan based on an unfavorable Facebook page?"

Related Article: Are LinkedIn Profiles Better Credit Barometer than Loan Applications

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In response to an argument on the need to overhaul the ways banks serve affluent customers:

"Does 'service,' 'rates and fees' or 'branches' strike an emotional chord with you? If it doesn't make you want to run out and visit a bank then why would you expect it to excite the consumer?"

Related Article: Faceless Gimmicks Won't Help Banks Keep Wealthy Clients