There's really two sepearate issues here:

1. Transition from magstripe to chip

2. Transition from signature-based verification to PIN-based verification.

The British/EU banking industry has done a great disservice in combining the two. There is absolutely no need to - here in HK, and in PRC, Taiwan, Japan, Korea and Australia (initially) (1) has been done without moving to (2).

(1) is an improvement for everyone on the whole. It really is like the introduction of seat belts or the Polio vaccine - a technological improvement with little downside for either bank or cardholder. There may be transition problems but once in place it really does cut down fraud.

(2) as as devious as DCC. At least in British-based Bills of Exchanges jurisdictions such as UK, Australia and HK, a bad signature is the bank's problem and not the customer's. What the UK banks have done is to introduce PIN-based authentication with DCC and surreptitiously move the liability for fraud from cardholder http://en.wikipedia.org/wiki/Chip_an...s.27_liability on the basis chip authentication (which is really a separate matter as the Hong Kong experience shows) should reduce fraud.

Although PIN authentication may seem more secure than a signature to Mrs. Jones on the High Street ("no-one checks a signature" is an approving remark I heard from such a Mrs. Jones from New Zealand) this is absolutely wrong from a legal point of view. From Bills of Exchanges law which later evolved to cheque law, a bad signature will release liability from the signer (cardholder) and also imposes liability on the person accepting the signature (the merchant) to satisfy himself the signer is who he says he is.

If your card is said to have been used on a Rolex purchase transaction in Switzerland authenticated by signature you can have your liability released by proving you've never visited Switzerland at the time of transaction (a pretty easy action for us Hongkongers since we can request Immigration Department Hong Kong to release our travel records to our bank).

If the transaction was authenticated by PIN then the banks can deny liability like ATM transactions and you have to prove the bank leaked card info...

The UK belatedly reintroduced fraud liability for banks in 2009 but banks still sometimes act as if it is for the cardholder to prove his PIN has not been compromised http://www.thisismoney.co.uk/money/s...ist-banks.html