Yeah I don't know why they have designed the card readers this way. It conditions the user to expect a ridiculous thing slapped on the front of the machine. In my opinion it makes it much easier for the skimmers.
I am curious if the stripe can be retained only for orientation and then have something embedded in the holographic image so many cards use that can be visually read. Kind of like a fixed CD
Chip cards use challenge-and-response with an embedded secret key and can't be cloned. (well, unless your bank so helpfully puts the card number+name in plaintext on the chip, as some do)
Eh not really skimmers are always going to be cheap to produce compared to what you can get in return.
You can't just change the tech of the cards because it needs to allow people from all over the world to use an ATM and most importantly you can't switch over ATM's and credit cards every few years that alone would cost more than what is lost to skimmers.
ATM's need to be reliable and consistent that actually makes it easier for both end users to detect skimmers and for ATM manufacturers to make them more resistant to skimmers.
Just to drive the point home ATM skimmers with the ability to read or probe the chip & pin were implemented before any chip & pin ATM's were out there it was simple enough to do in real time by just inserting an additional shim that would touch the smart card interface on your bank card.
The skimmer shown in this video is a fairly basic one there are already skimmers with NFC and Chip & Pin capabilities that read out the pin pad in real time to process a direct charge transaction while you use the ATM (they don't care about stealing your Track 1 and Track 2 data).
The ways of reading the pads vary from using cameras that are not that different from the kinect one to laying a thin touch sensor over the keypad to actually running a differential capacitive touch analysis on the metal keys as they are grounded.
A single skimmer in a tourist spot can be used to access 10,000's of accounts over a single weekend with that financial incentive the cost of the skimmer can almost be ignored.
The cost of the skimmer is insignificant, but the labor to replace it adds friction and is going to reduce the number of active skimmers. To replace the removed skimmer will also expose the criminal to more risk of getting caught, especially if the police are aware of the removal and can set up a sting or something.
So while the economic ROI is so high the behavior will continue, it does slow them down.
Not a complete fix by any means, but adding friction to their criminal behavior.
It's not a fix both cards and ATM's have to serve the lowest common denominator you can't just replace billions of cards and millions of ATM's every few years because of skimmers.
The labor to replace skimmers is already not an issue skimmers do not last for years, or even weeks most of them have a battery that only lasts for a few days and they are put at strategic locations usually hot spots around big venues or events.
From my understanding the new chip cards are, in effect, smart cards meaning that after the first use, the information collected is useless. Whereas with a magnetic stripe the CC #, CVV #, expiration date, and name are all transferred plaintext.
Your understanding is incorrect.
This is just one example [0] there are many ways to skim Chip & Pin (EMV[1]) cards, even if you build a card which cannot be cloned through active or passive monitoring of the ICC component you can still perform at least 1 illicit transaction by proxying to it.
The same holds for NFC skimmers which are now becoming more and more relevant and popular especially with the commercial availability of ultra-low-power and ultra-compact wireless SOC's.
If some one was wondering what are things like ESP8266[2] that give you WiFi connectivity with less than 1mW standby draw while being the size of a quarter are good for; if nothing less they are a pretty damn good platform for real time NFC or ICC skimming.
