The Next Huge Credit Card Theft Can Be Avoided. Here's One Critical Step.

Credit cards can be more secure. But it'll take time.

Apr 12, 2014 at 1:22PM

It's not all about Wal-Mart. Or Target (NYSE:TGT) for that matter.

That was a key message from Visa's (NYSE:V) Bill Sheedy at the Transact 2014 payment technologies conference in Las Vegas. Sheedy's remarks focused a lot on security. That makes sense -- if anyone has a vested interest in avoiding the next big, high-profile credit card breach, it's Visa. Allow consumers to be convinced that they're at risk by swiping a credit card, and it's an obvious bad for Visa's business.

Most of us have heard about some of the technologies that are either set to be implemented or possibilities for the future. EMV -- "Europay, MasterCard, Visa" -- is a chip on credit cards that provides an additional level of security at the point of sale. Tokenization is a process for transferring sensitive data in a way that's more secure and difficult to steal. And of course, there are even more simple and basic solutions, like securing buildings and rooms that hold customer data and keeping computer systems up to date to keep hackers and worms out.

You don't have to tell Target twice about the importance of securing customer data. Or Nieman Marcus. Or Wal-Mart, Whole Foods, or many other retailers that haven't had recent, headline-grabbing data breaches.

But as I began, it's not these giant merchants that are the challenge for Visa and other payment giants to get on board: It's small businesses. It's the karate school down the street. It's the small cupcake shop. It's the delicious food cart that just started accepting credit cards.

It's comparatively easy to go to Wal-Mart, where there are teams of people devoted to questions around payments and securing data, and talk about making payments more secure and what that means for the company. But that's more difficult when you're talking to somebody who's great at making and selling beautiful hand-made jewelry, but has little idea what tokenization means.

This is hardly insurmountable. But the success and ubiquity of credit cards means that there are an incredible number of stakeholders in the system, and those stakeholders need to be educated. And that's the challenge ahead of Visa and its ilk: They need to educate the payments companies and merchant acquirers that are using the Visa network. And those companies, in turn, need to educated the millions of small and medium-sized businesses.

It's critical for a secure future for credit cards. But it won't happen overnight.

The credit card in your pocket may soon be completely worthless
The plastic in your wallet is about to go the way of the typewriter, the VCR, and the 8-track tape player. When it does, a handful of investors could stand to get very rich. You can join them -- but you must act now. An eye-opening new presentation reveals the full story on why your credit card is about to be worthless -- and highlights one little-known company sitting at the epicenter of an earth-shaking movement that could hand early investors the kind of profits we haven't seen since the dot-com days. Click here to watch this stunning video.

John Mackey, co-CEO of Whole Foods Market, is a member of The Motley Fool's board of directors. Matt Koppenheffer owns shares of Target and Wal-Mart Stores. The Motley Fool recommends Visa and Whole Foods Market. The Motley Fool owns shares of Visa and Whole Foods Market. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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