Credit card expiration dates push year 2000 compliance

by Patrick Nolan

SBJ Contributing Writer

Merchants who accept credit cards but have not yet tested their year 2000 compliance could have some trouble with cards whose expiration dates are in 2000 or beyond, according to major credit card companies.

While the Y2K bug affects any industry with date-sensitive software, because of the two- to three- year expiration cycles of electronic payment cards, the problem must be dealt with a little earlier in the credit card industry.

Merchants must put a high priority on this issue or risk delayed transactions and customer inconvenience, according to information from MasterCard.

American Express, MasterCard and Visa, along with other credit card companies have begun distributing cards with expiration dates of 2000 and beyond. These cards may not register on point-of-sale equipment if it is not Y2K compliant.

MasterCard reported on its Web site that in some cases terminals "will return cards that expire in the year 2000 and beyond with an 'invalid card' or 'rejected by terminal' response."

Molly Prost, a spokesperson for American Express, said it began issuing cards with expiration dates of 2000 and beyond in June 1998.

"What we needed to do before we started issuing the cards was make sure the (point-of-sale) devices were upgraded," Prost said. "We had American Express employees use cards with 2000 dates to test acceptability."

Linda Locke, vice president of technology and communications for MasterCard, said MasterCard has been distributing cards with expiration dates of 2000 and beyond for more than a year.

"We are seeing virtually no problem," Locke said. "We have been very pleased with the progress made."

The MasterCard Web site advises merchants who are unsure of their Y2K compliance to test point-of-sale terminals and system pathways. Bank card processors have test cards and account numbers to arrange for tests.

If a merchant's equipment is not Y2K compliant, it is important to contact the card processor to arrange for an upgrade. The processor may either upgrade the software or replace the terminal.

Visa recommends businesses compile a inventory to prepare for the change. Make sure inventory includes software, hardware, operating systems, networking and telecommunications systems, and electronic interfaces with business partners and suppliers.

All of the major credit card companies agreed on a few basic points: Every merchant needs to inventory his equipment and analyze the impact on each item, and convert or replace items as needed. Vendors should be contacted to obtain compliant versions of their products. Work with information systems staff or consultants to convert your proprietary software. It is also important to verify the warranties, service contracts and maintenance agreements for all equipment that may be affected.[[In-content Ad]]