It's the flash new technology that is supposed to revolutionise credit card use. But is slow processing of microchip cards costing people too much time at the checkout?

That's the growing view from users, including restaurateur Jaswant Singh, who runs the Shiraz chain of Indian restaurants. He said the difference in processing time between chip and swipe cards was noticeable. "It takes ages to go through with a chip ... people think their card is going to decline."

He said it was more of an inconvenience than anything but could cause hassles when the restaurant was busy.

Every credit card terminal has now been upgraded to accept cards with chips. Nearly three million credit cards are in circulation in the country and all new cards issued after April 1, 2010, have a chip.

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It is expected that, by 2014, every credit card in use will have a chip.

But Paul Whiston, Paymark head of sales and marketing, said the processing delays might not be as bad as people perceived.

The chip functions as a basic microprocessor and, he said, like computers, early models were not fast. "The quality of chips has improved."

Kiwibank spokesman Bruce Thompson said one of the big advantages was that customers did not have to part with a chip card at any stage of the transaction process, so the risk of having their details skimmed was significantly reduced.

He said the time it took to process depended on the quality of the technology the retailer used. "You might see that in the supermarket, sometimes it goes through quite quickly, sometimes you wonder what's going on."

Whiston said processing time was usually now similar to that of swipe cards, but chip-cardholders might feel that it took longer because they were in control of the whole process. Whereas previously customers would give their card to a retailer who would take it behind the counter to scan, they now controlled the process from end to end.

Chip cards were more secure because they provided a high level of encryption. They also had other features such as contactless payment, with no pin or signature required, for small purchases. Customers simply "tap and go".

Within the next nine months, ASB Mastercard and debit-card holders will receive cards that allow them to pay via this method. National and ANZ have already distributed 50,000 of them. ASB expected early commercial adopters of the technology to be shops, petrol stations, bars and the express lanes of supermarkets.

One of the challenges, though, will be to get customers comfortable with the idea. It was reported that customers complained when McDonald's introduced a no-pin-necessary policy for purchases under $35.

Card pros and cons

VIctoria Rowe has had a chip credit card since they first became available in about 2008. "Initially, there was a big difference in processing times. I was told it was because chip card authentication occurred in New Zealand."

Since then, the processing time had improved significantly.

"The massive advantage is that the newer chip card, the one I was issued with this year, requires a pin number for processing, so a signature isn't enough."

But she's concerned that one of the new features is that the card can be scanned for purchases up to $80, with no pin required. "This has to be a security downgrade."