For years we've been hearing how European credit cards have a "chip" and operate with a PIN, while U.S. credit card systems have refused to change away from the mag-stripe card. We saw the chip/PIN setup in New Zealand, although our U.S. cards were accepted there. But we knew that in France, vending machines and possibly other places would not accept the U.S. style card. What to do?
Fortunately, this year Chase began offering a Hyatt card with a chip that European machines can read. It also has some other benefits for travelling, notably it does not charge a fee for a transaction in a non-U.S. currency, as most other cards do. So we signed up for one and can report that it works very well.
The first big test was on arrival day when we used the Hyatt card to buy train tickets from a vending machine at the airport. It worked without a hitch, and we were off. It worked smoothly buying tickets at vending machines in the Paris Metro, and for bus tickets in Nantes; and in gas stations and grocery stores. Every restaurant in France uses the same little card reader. When the waiter sees you want to pay by card, he brings the little machine to the table, sticks your card in, keys in the total bill amount, and in a few seconds the receipt prints out and you're done. The Hyatt card worked in all these cases.
There is one difference. European bank cards have the PIN encoded in the chip. After inserting the card in the machine, you key in your PIN, and it's verified from data on the card without an internet access.
The Hyatt card does not have a PIN; it is a so-called "chip-and-signature" card. What this means is that the waiter's little machine in the restaurant can't authorize locally. It has to make an internet call to the card provider to get the OK. It does that and after a few seconds, Autorisé appears on the screen. Then it machine prints two receipts and you have to sign one.
Some of the restaurant card readers couldn't handle this. The waiter would have to take it back to his desk and stick it in a dock so it could do the internet thing. At other restaurants the portable card reader was (presumably) wifi-enabled and could get the authorization at the table.
Having to wait the extra 10 seconds while the card authorizes, and having to sign, are minor inconveniences. We'd prefer a chip-and-PIN card, but this one certainly worked. And it saved us a ton on currency conversion fees.
By the way, our bank, the Stanford Federal Credit Union, does not charge a conversion fee on ATM withdrawals in non-U.S. currencies, either. It was converting our €200 withdrawals at the going conversion rate for Euros, with no extra percentage added on. So that was good.