Researchers at East Carolina University in Greenville, N.C., studied the link between parents’ roles and the financial knowledge and behaviors of college students at seven universities across the U.S.

You might expect that students who witnessed parents’ financial arguments would be more conservative in their credit use in an attempt to avoid their parents’ mistakes. But the study’s results, released in the October issue of the Journal of Family and Economic Issues, showed the opposite. They were the most likely among students polled to have larger credit card balances. They were also twice as likely to have more than two cards compared with those whose parents didn’t argue over money matters.

In fact, the study’s authors concluded parents arguing about money was one of the top predictors of a student having credit card debt over $500. The study notes that credit card debt over $1,000 is risky for this age group and has been linked in previous studies to unhealthy behaviors like substance abuse.

The Credit CARD Act of 2009 stopped issuers from actively recruiting on college campuses and tried to curtail consumers under 21 from getting their own credit card accounts unless they could show proof of income. However, the study found nearly two-thirds of the more than 400 students surveyed had a credit card, and nearly a third had more than one.

The study’s authors point out that some behaviors may start to develop from what they hear at home. With that in mind, here are some tips for family money discussions:

• If the talk is getting heated, move the discussion out of the house away from the children or schedule a time to talk about it when the kids are away.
• Deliver a consistent message if you need to share bad financial news with children. Talk with your spouse about what you will say so that you don’t add confusion to the mix.
• Encourage kids to ask questions and use financial missteps as a teaching tool.
• Be honest, but don’t worry children with too many details.

“It is clear that the influence of parents cannot be underplayed,” the authors concluded. “Researchers, educators and policymakers should work with, and include, parents in finding effective ways to increase the positive financial behaviors of college students, particularly those behaviors related to credit card use.”

So now’s a good time to strategize about which payment method will work best for you — credit cards, prepaid cards or cash — this holiday season.

If you’re a disciplined spender and know the pitfalls, credit cards can offer bonuses and protections that can give you more bang for your buck.

But if you need to protect yourself from your own generosity and fear getting caught up in the seasonal shopping frenzy, cash or prepaid cards may be safer.

All three payment options have benefits and drawbacks, so here are some things to think about before hitting the stores.

1. Credit cards

Pros: The beauty of credit cards is that you can spread payments over months if you need to. Of course, that will cost you in interest, but time is on your side here.

Credit cards also offer some valuable protections. For starters, they are covered under the Fair Credit Billing Act, which means you can dispute charges if gifts arrive damaged or don’t show up at all. Credit cards also come with built-in federal protections against loss and theft — so, if your card is stolen and used by a thief, the most you’d be liable for is $50. Some cards also offer price protection, so if you find the same item for a lower price within a certain window of time after you bought it, your card may refund the difference.

Many credit cards also offer to extend manufacturers’ warranties, which could come in handy, especially with electronics purchases.

Also, using a credit card responsibly will help improve your credit score, a plus that prepaid cards and cash don’t have.

Cons: Credit is a convenient way to spend more than you have, so it’s easy to rack up debt. Add late charges to that, and you could set yourself on a dangerous cycle of debt well into the new year. In addition, know that the introductory offers that convinced you to apply for a particular card in the first place will eventually go away and that annual fees and higher annual percentage rates (APRs) may kick in.

2. Prepaid cards

Pros: The main advantage here is you can spend only what you load onto the card, so there are no interest charges, over-the-limit fees or required minimum payments involved as there are with credit cards. Prepaid cards are safer than cash because you need a PIN to use them (keep in mind, however, that many prepaid gift cards do not come with a PIN). Also, if you lose your card, you can call to have it replaced with the funds you already loaded on it (minus a fee).

Prepaid cards are easy to get at grocery stores, drug stores and convenience stores, and, because you load them up with your own money, they don’t require a credit check.

Cons: These cards may not have the federal protections credit cards have. You can also get zapped with multiple fees. These could include fees for loading the card, monthly fees and fees for withdrawing cash at ATMs. Moreover, no matter how much you spend on the prepaid card, it won’t help you build a good credit score, as prepaid cards do not report to the credit bureaus. Plus, if they get lost or stolen, some prepaid card issuers don’t have policies in place to help you get your money refunded.

3. Cash

Pros: As with prepaid cards, you can spend only what you have on hand (as long as you leave your checkbook at home). Also, all merchants take cash for purchases of all sizes (which isn’t always the case for plastic). Some merchants will even offer a discount if you pay this way. This option is open to anyone — you don’t have to qualify to use it.

Cons: If you drop a wad of cash, or someone lifts it from your wallet, it’s gone. There’s no covering the loss.

Record keeping is also tougher with cash. You don’t have the automatic electronic receipts that credit cards and prepaid cards offer, and you won’t be able to log on to a website to view your entire transaction history and monitor your spending patterns.

Also, just as with prepaid cards, spending cash wisely doesn’t help you build up your credit score, but if that’s a top priority with you, there’s no need to be concerned.

Finally, there’s the barrier to Internet shopping. You’ll miss out on online deals if you go cash-only for holiday shopping.

When you’re plotting your strategy, keep in mind some payment forms may work better for some purchases. For instance, if you’re buying plane tickets, credit cards offer protections, such as refunds if an airline goes out of business. Also, charging big purchases can help you rack up rewards for something you need later in the year. For small gifts, cash and prepaid cards may help keep your budget on track.

To help you decide which payment method works best for you, first look at last year’s holiday spending and think long and hard about what kind of spender you are at this time of year. Then think about how you felt about your holiday spending last January.

You grab your mobile phone or tablet PC, punch some keys to charge the item to your credit card account while you’re watching the show, and days later it shows up at your door.

That’s the idea behind a joint venture announced Nov. 7 by American Express and broadcasting company NBCUniversal.

Under the deal, an item selected from either Bravo’s “Life After Top Chef,” E!’s “Fashion Police,” or Style’s “Tia & Tamera” will be featured each week. Spots will run on those networks telling American Express cardholders how they can buy the item immediately. Initially, American Express is adding even more temptation to try out this new purchasing method by offering $35 to cardholders who buy an item with an eligible AmEx card they’ve synced with their Facebook or Twitter accounts.

Next step from social TV
The companies are counting on riding the wave of social TV — the concept of linking TV to social media, so you know which friends are watching the same show at the same time and can comment on it with them as though you’re crammed on the same couch. To link people’s urges with shopping capability, the companies will use zeebox, an app that lets friends chat with each other on some smartphones and tablets, or on Twitter or Facebook feeds, while they are watching the same show.

The marketing logic is simple: With TV becoming a more interactive experience, why not make it easier for people inspired by items associated with a particular show to take the next step and buy them when the urge strikes? If chef Fabio Viviani is using a knife set on his show, why shouldn’t you be able to it, too? Viewers can then use zeebox talk up the purchases with their friends in real time as well.

“We know today’s consumers are on other screens while watching television,” Linda Yaccarino, president of NBCUniversal ad sales, said in a press release. “This innovative deal is a seamless way to capture their attention around the products and experiences featured on the shows they love.”

Acting on urges has a downside
Of course, the very thing that makes it so convenient to act on your urges can also get you into a world of trouble with credit.

Marketers know that many consumers don’t have the self-control to carefully consider each purchase with this new option. Consumers lose the buffer of time that can help them decide whether they really must have that item after the excitement passes. If a show and app make it practically effortless to buy something in real time, there’s no time for that voice of reason or the sleep-on-it factor to save you from yourself.

Parents might have concerns as well, as there’s the danger of kids in your household being bombarded with the “Buy it now!” message that feeds the expectation of instant gratification. If they’re engaged in the social media aspect of this new program, their friends are getting the sales pitches at the same time, and they can talk about them on their phones and tablets. Suddenly, TV watching becomes a lot more like a trip to the mall.

By all accounts, the financial toll will be enormous – the Associated Press reports $20 billion just for the physical damage and another $30 billion in lost business.

Feeling the pinch on a smaller scale are consumers unable to log on to their online accounts or get to a bank to make a deposit — and who are therefore in danger of getting hit with overdraft or insufficient funds fees.

In response, many major banks are offering their customers on the East Coast a break:

• JP Morgan Chase is waiving insufficient funds fees, extended overdraft fees and late fees for loans and credit cards until Nov. 1 for customers in affected areas, according to the Huffington Post. Customers have until the end of the business day Nov. 1 to make deposits to avoid these fees.

• Wells Fargo is waiving late fees and out-of-network ATM fees through Nov. 1, and Barclays is waiving cash advance fees according to CNBC.
• Citibank is waiving out-of-network ATM fees in affected areas until an unspecified date, according to the Wall Street Journal.
• Bank of America customers in affected areas can call the bank to have fees incurred because of the storm waived, according to Time.

Consumers looking for ways to help are also stepping up, making donations online, over the phone, by mail and in person.

Unfortunately, scammers often step up their efforts as well after disasters.

While the urge to give now and give quickly may take over, take a moment to make sure your donation will be used the way you intended.

The Better Business Bureau advises doing a quick bit of research to decide which charity will put your donation to the best use. Check whether an organization you’re considering meets the 20 BBB standards for charity accountability.You can also check the Internal Revenue Service’s list of tax-exempt organizations.

The primary central location for donations is the Red Cross. You can access its system in several ways: Visit www.redcross.org, call 1-800-RED-CROSS or make a $10 donation by texting the word REDCROSS to 90999. People mailing checks can send them to the American Red Cross, P.O. Box 37243, Washington, D.C. 20013, or to their local Red Cross chapter.

Other legitimate organizations will be collecting funds as well, so here are some tips for vetting them:

• Watch out for organizations that have names just slightly different from the name of a legitimate charity.
• If you hear that “100 percent of the donation will be used to assist victims,” be suspicious. Charities have to use a percentage of donations to pay costs for staff and operations. Even a credit card donation involves a small processing fee.
• Pay by credit card, debit card or check rather than cash. These methods offer the best tracking and protection. If you do pay by check, make it out to an organization rather than to an individual.
• Don’t respond to an emailed link. That may lead you to a fake website that looks very much like the real thing. Look up the organization’s website, then look for the link to donate from there.
• Avoid charities that pressure you to use wire services such as Western Union or MoneyGram to transfer money. Legitimate charities won’t do that.
• Check the charity’s Web address ending. Most legit ones end in .org rather than .com.

If you do uncover a scam or suspect one, report it to the FBI and National Center for Disaster Fraud’s hotline at 866-720-5721.

An October 2012 study, “Global Consumer React to Rising Fraud: Beware Back of Wallet,” from electronic payment company ACI Worldwide and research firm Aite Group polled 5,200 card users about credit card fraud and its impact in 17 countries. Overall, one in four who responded said they have been victimized by credit, debit or prepaid card fraud in the past five years.

Among the detailed findings was this revelation: More than half of those who experienced fraud — 56 percent — said the experience was enough to make them switch from credit and debit cards to cash or an alternative payment form in certain situations (among U.S. consumers, 37 percent said they reacted this way). Among those who received replacement cards after fraud, 46 percent worldwide said they used the new card less than they had used the original.

This is certainly concerning news for financial institutions, as they are essentially losing business due to fraud. Yet less-frequent card use could have consequences for consumers, too. It’s easy to see why a fraud victim might be wary of using plastic, but stuffing your cards in the back of your wallet may work against you.

Here are some things to think about before you bench your plastic.

• If you lose your credit card, you’re protected: That’s not the case with cash or some other alternatives. You can get a replacement card from your issuer, and, under federal law, you’re liable for $50 at most if someone makes fraudulent purchases on the card.

• You won’t rack up the rewards: By paying with cash instead of using a rewards credit card, you’re missing out on accumulating miles, merchandise and cash back.

• You won’t have the same protections when you shop: Credit card agreements include protections if you receive damaged merchandise and may offer protections on returns that other payment methods don’t. But you have to purchase the item or service with the credit card to use that protection.

• Your credit score may take a hit: Using your card slightly less often won’t hurt your credit scores much. However, if your cards are the only form of credit in your portfolio, and you banish them from your wallet entirely, you might see your credit standing fall. Lenders like to see regular evidence that you can borrow money and pay it back on time. If you eliminate all that evidence, they might be less likely to do business with you.

Rather than relegating your card to the back of your wallet, consider these proactive tips if you’ve been burned by fraud:

• Set up fraud alerts: This is a notice that the credit bureaus attach to your credit report. When you, or someone else, tries to open up a credit account in your name, the lender is supposed to verify the action with you first. Note that the lender should, but doesn’t legally have to do this.

• Check into credit monitoring/ID theft protection services: Some banks will keep track of changes to your credit information and alert you immediately if it sees potential fraudulent activity. Sometimes a home insurance policy includes ID theft protection. Be aware that most outside credit monitoring services will charge fees or may start out free and then charge fees if you forget to cancel.

• Freeze your credit:  This involves writing to the credit bureaus and asking to lock down your credit, which prevents lenders from opening new lines in your name. If you want to open credit for yourself, you have to get the freeze lifted.  If you’ve been a victim of identity theft, you can get a credit freeze for free in most states. For details on how to freeze your credit, visit the websites of all three credit rating bureaus: Experian, Equifax and TransUnion. Be aware that it can take days to get the freeze lifted, which could be inconvenient if you need credit quickly.

This week, the financial and retail giants introduced Bluebird, a prepaid debit card that promises no required minimum balance, no monthly maintenance fees, no annual fees, no activation fees and no overdraft fees. The only fees are $2 for ATM withdrawals, though the first one each calendar month will be free, and a $2 fee if you reload the card via a debit card. Read the full card agreement here.

For comparison, Americans pay an average $200 a year in various bank fees, says Wal-Mart Vice President Daniel Eckert, citing a February 2012 Bretton Woods survey.

“Bluebird is our solution to help consumers who currently may be poorly served by traditional banking products,” said Dan Schulman, group president of American Express, in a press release.

American Express may have found a wealth of such consumers in its partnership with Wal-Mart, which has said 85 percent of its daily transactions are done in cash.

Beyond Walmart stores, customers can use the card anywhere American Express is accepted.

How the card works
The Bluebird card works much like other reloadable prepaid cards on the market. Users can get it online for free at Bluebird.com (starting next week — the site isn’t up yet), or at Walmart stores for a $5 fee. However, the card available at Walmart is only a “starter” card — cardholders will still have to go online to set up their accounts and get a permanent card.

Upon set-up, the cardholder must designate a funding source (such as a bank account) from which a minimum of $25 will be withdrawn and loaded onto the card. After that initial load, more money can be added (up to a maximum of $5,000) via direct deposit, cash at Walmart, debit card or bank account. You can also load money via Green Dot’s MoneyPak or InComm’s Vanilla Reload Network Card, although you may incur fees from Green Dot and InComm.

Why consumers want alternatives
Here are some statistics that add to Bluebird’s appeal:

• Banks charged a total of $31.6 billion in 2011 in overdraft fees, according to Moebs Services.
• The average minimum balance necessary to avoid a maintenance fee on a checking account was $723, up 23 percent from last year, according to a September 2012 Bankrate study.
• One in four consumers already conducts some or all of financial business outside traditional banks, the Federal Deposit Insurance Corp. (FDIC) says.

In addition to the fees it doesn’t have, the card has extra features more typically associated with credit cards. For instance, consumers will have access to American Express customer service and roadside assistance.

It also opens up mobile possibilities for the unbanked. That means a friend can send money directly to your Bluebird account to split a dinner bill via a person-to-person (P2P) mobile app. You can also take a picture of the check your uncle sent you for your birthday and deposit it straight into your account from your smartphone.

Some drawbacks
Despite its perks, the Bluebird card is a prepaid card and therefore lands in largely unregulated territory — although the Consumer Financial Protection Bureau is working to change that by establishing rules for the prepaid industry.

In the meantime, consumer advocates caution that prepaid cards may not have the same federal protections that credit cards have. Bluebird, for instance, is not backed by the FDIC, though it is backed “100 percent” by American Express Travel-Related Services Co., Schulman said in a webcast announcing the card.

Bluebird will be available next week online at Bluebird.com and at 4,000 Walmart stores.

Delinquent bank credit card payments, defined as payments that are 30 days or more late, dropped below 3 percent (to 2.93 percent) in the second quarter for the first time since 2001. That’s down from 3.08 percent in the first quarter and significantly lower than the 15-year average of 3.91 percent, the ABA reports.

Nervous consumers are thinking twice about charging up their cards, said James Chessen, ABA’s chief economist, in a statement.

“Economic uncertainty has made consumers hesitant to take on new debt, and building a stronger financial base has become a priority,” Chessen said.

Reining in spending
Discouraging job news may be helping to keep consumers focused on keeping debt low.

Although the unemployment rate dipped to 7.8 percent in September, according to the latest Bureau of Labor Statistics figures, it hovered above 8 percent for the entirety of the second quarter (the time period that corresponds with the ABA’s numbers). BLS statistics from the second quarter showed stagnant wages, and the number of long-term unemployed (those who have been jobless for 27 weeks or more) remained stuck at around 5 million (40 percent of the unemployed).

Increased vigilance in getting payments in on time is good news for credit scores because payment history makes up the biggest chunk– 35 percent — of a FICO score.

FICO considers how recent the late payments are, how big they are and how frequently they happen. The credit scoring company notes that you can recover from a late payment by getting current and not making that mistake again. What you don’t want to happen is for your creditor to either charge the debt off or send it to a collection agency. That’s considered a significant event, and your score will take a major hit.

Home loan payments not as prompt
While the ABA report showed progress on the credit card payment front, the news was not as rosy for payments on home loans. In the second quarter, delinquencies rose in all three categories of home-related loans. Property improvement loan delinquencies rose from 0.8 percent to 0.9 percent; home equity loan delinquencies rose from 4 percent to 4.09 percent; and home equity lines of credit delinquencies rose from 1.8 percent to 1.9 percent.

The numbers show homeowners are still struggling to pull out of the housing market collapse.

“While the housing market appears to have turned a corner, we are many quarters away from seeing improvement filter through to reduce home-related delinquencies,” Chessen said.

CFPB Director Richard Cordray testified before Congress Sept. 20 that certain wording within the Credit CARD Act of 2009 was causing a “significant problem” for stay-at-home spouses. Under the law, card issuers were to consider only applicants’ individual income instead of household income when making lending decisions.

As a result, stay-at-home spouses who don’t get a paycheck and who rely on the other spouse’s income might get turned down for a credit card if they apply on their own — even if they have stellar credit scores. Of course, spouses can become authorized users on a partner’s credit card, but that misses the point, critics of the rule say.

Stay-at-home mom started petition
One of those most outspoken critics was Holly McCall of Vienna, Va. She posted a petition on the advocacy website Change.org and got more than 40,000 signatures.

In the petition, she stated her case: “It is 2012, and because I’m a stay-at-home mom, I can’t get my own credit card. My husband has to give me permission to get my own line of credit. This is demeaning and flat out unfair. This is despite the fact that I make 95 percent of our household purchases, have an impeccable credit score and handle the majority of my family’s finances.”

Support for challenging the law came from both parties. Reps. Carolyn Maloney, D-N.Y., and Shelley Moore Capito, R-W. Va. (chairman of the Financial Services Committee’s subcommittee that oversees the CFPB), were among those pushing the CFPB to address credit access.

Cordray agreed and appeared before Congress saying, “Tens if not hundreds of thousands” of Americans have been denied access to credit as a result of the rule, based on data the CFPB gathered from the credit card industry.

Unintended consequences
The original intent of the controversial rule was to keep young consumers from using their parents’ income to qualify for credit cards and then accumulating debt they weren’t ready to handle. But others caught in that provision were stay-at-home spouses.

The CFPB’s proposed new regulation has its critics in some consumer advocates who think the law as it is written protects people, even spouses, from racking up unmanageable debt.

National Consumer Law Center attorney Chi Chi Wu was quoted in The Huffington Post in May as saying, “If the stay-at-home spouse opens up a credit card account using the other spouse’s income and then there’s a divorce, she’s now racked up debt possibly without the income to pay it back, putting her in a worse position than if she’d never racked up the debt at all.”

But Cordray is undeterred. He says the agency intends to write a new regulation rather than clarifying the existing law. He said the CFPB would propose the rule before Congress reconvenes after the November election.

Experian’s third annual State of Credit report says Minneapolis residents racked up Vantage scores averaging 787 out of a possible 990, way above the national average of 750. Beyond bragging rights, the numbers bode well for its residents getting better terms on loans.

Although the report shows some encouraging signs of credit improvement despite the recession, it also shows that some areas of the country are faring much worse than others.

Northern cities flourish, while southern states flounder
Experian’s report looked at the average Vantage scores of cities throughout the U.S. Vantage scores are developed jointly by major credit bureaus Experian, TransUnion and Equifax and range from 501 to 990 (the more commonly used FICO score uses 300 to 850). On both scales, the higher the number, the lower the credit risk.

As in the previous two years, this year’s rankings reflected a geographical divide. The Upper Midwest swept the top five, and the bottom five cities were all in the South.

Here’s a rundown of the cities with the top five and bottom five cities (and their average Vantage scores).

Top 5 cities:

1. Minneapolis, Minn. (787)
2. Madison, Wis. (786)
3. Wausau, Wis. (785)
4. Sioux Falls, S.D. (784)
5. Cedar Rapids, Iowa (783)

Bottom 5 cities:

1. Harlingen, Texas (688)
2. Jackson, Miss. (702)
3. Corpus Christi, Texas (706)
4. Monroe, La. (708)
5. Shreveport, La. (709)

Have recession lessons been learned?
Experian has conducted the survey for each of the past three years to see whether lessons have been learned from the economic downturn and whether Americans have improved at policing their spending.

Overall, there’s progress: The average number of late payments dropped 2 percent and average credit scores ticked up from 749 to 750 this year.

In several pockets of the country, the gains were dramatic. Two cities hit particularly hard in the recession — Las Vegas and Bakersfield, Calif. — were among the biggest gainers in credit scores since 2011. Both have been in the bottom 10 the past two years, but managed to avoid climb out of that ranking this year.

Some factors that likely helped consumers in managing debt were big reductions in foreclosure and unemployment rates. Las Vegas’ foreclosure rate dropped a whopping 162 percent, and unemployment dropped 2.5 percent from 2011 to 12.5 percent in 2012. Bakersfield residents were able to reduce their late payments by 28 percent, while foreclosures decreased 15 percent and unemployment decreased 10 percent to land at 13.9 percent. Consequently, Bakersfield consumers had the highest credit score gains in the survey, reaching an average of 717 (compared to an average of 708 just two years ago).

“Increasing numbers of Americans are showing they understand how credit works. They’re paying their bills on time and lowering their debt-to-limit ratio,” said Maxine Sweet, Experian’s vice president of public education, in a news release. “It’s encouraging to see them demonstrating that they have the resources to make those positive changes in how they manage credit.”

Experian took a look at more than 682,000 credit files and analyzed consumers’ average credit scores, debt levels and credit utilization in more than 100 U.S. cities.

So what is No. 1 city Minneapolis doing right?

“The most significant thing in Minneapolis is that consumers miss fewer payments,” Sweet told Credit Card Guide. “They don’t carry less debt, but they have lower utilization, meaning they aren’t charging their cards to the limit. We also note that they have lower unemployment, fewer foreclosures and are highly educated compared to the averages in other cities.”

The American Automobile Association (AAA) has is rolling out an EMV credit card. EMV stands for “Europay Mastercard Visa” and refers to the chip-and-PIN technology that’s already common throughout the rest of the world. Magnetic stripes are still the norm in the U.S., although some issuers, including Bank of America, Chase, Citi, U.S. Bank and Wells Fargo, have begun adding EMV chips to certain cards.

AAA’s move is aimed at helping U.S. travelers who often find when they leave the country that machines abroad — such as train ticket kiosks — won’t accept their magnetic stripe cards.

What’s different about EMV cards?
Some things won’t change: AAA’s chip cards will continue to prompt customers to sign for some transactions, and they will still have a magnetic stripe (in addition to the EMV chip) to make them compatible with U.S. merchants.

Yet the addition of an encrypted microprocessor chip will help the U.S. catch up to Canada as well as countries in Europe, Africa, Asia and Latin America, which are way ahead with this technology.

“Chip-enabled cards will expand purchase options, add convenience and transaction security for Americans traveling abroad,” said Siobhan O’Donnell, director of AAA financial services sales and marketing, in a press release.

EMV cards are also generally considered safer because cardholder data are stored within the chip, and transaction data are encrypted uniquely each time the card used, making EMV cards difficult for scammers to hack, skim and clone.

AAA’s new EMV cards will be issued through AAA’s partnership with Bank of America, which announced in July that it was making EMVchip cards available to its customers. If you have a AAA credit card already, you need only call the customer service number on the back of your card to get the EMV version. Chip cards will be rolled out for new cardholders later this year.

Adoption accelerating
The move to EMV has come at a snail’s pace to the U.S. as card companies have been slow to push for the cards as retailers were reluctant to pay for overhauling their payment infrastructure. Conversely, retailers were slow to change because they didn’t know whether card networks would make the move. That started to change last year.

Visa led the charge in August 2011 by offering incentives to retailers to make the switch. Now MasterCard, Discover and American Express are developing their own plans to get retailers to start updating their systems to accept the cards.

Another reason for the push: EMV card readers allow contactless payments. Instead of making direct contact via a swipe, the card can be tapped or waved near the payment terminal. Payment terminals that can do this are also compatible with near field communication (NFC), the technology that allows consumers to make payments with their cellphones and that happens to be the basis for several emerging mobile payment applications.