The technology, developed by Visa, MasterCard and Europay, uses a smartcard containing a chip to store the cardholder's details. When an item is purchased the card is swiped through the retailer's card reader and the transaction authorised by means of a PIN (Personal Identification Number) rather than a signature.
Research, carried out for Visa by analysts TNS, suggests that people in the UK will have no problem adopting new chip and PIN payment technology when it is rolled out nationally later this year.
The system is already underway in Northampton where 600 retailers are "switched on" to chip and PIN and over 181,500 chip and PIN cards have been issued by participating banks.
The research shows that using a PIN is now just a part of everyday life for most people, with only 4% of UK consumers are not yet at ease with remembering and using a four digit PIN.
The research also found that 29% of UK consumers have no problem remembering a range of different four-digit PINs for most purposes in everyday life. In fact, on average each of us have three PINs committed to memory for day-to-day use, such as withdrawing cash from ATMs, setting a burglar alarm or a security code on a mobile phone.
The new chip and PIN payment system is flexible and geared to making it easy for consumers to choose a four digit number that suits them. In future, once consumers have been allocated a four digit number by their bank they will have the opportunity to change it to something more memorable at any Visa-branded ATM.
Remembering PINs is not quite the burden that many people think it is. Thirty-eight percent of those surveyed were quite happy to memorise and use the number they were sent by their bank and 21% of people used a memorable series of PINs. Only 6% of people said they forget the PIN they are issued.