Chip pin credit cards prevent fraud

People across the USA have been receiving new credit cards from their banks recently. “October 1st, the liability for credit card fraud shifts from the card issuer to the retailer if the retailer does not have the latest technology available”.

EMV which stands for Europay, MasterCard and Visa is a global standard for cards equipped with computer chips and the technology used to authenticate chip-card transactions. As the debate rages on, the chips will only be associated with your signature, at least for now.

Many European nations and Canada have been using advanced EMV technology, commonly referred to as “chip and pin”, for years and soon the US will too. But the technology isn’t there yet, so for now, you’ll dip your card and sign just as you’re doing with your current credit cards. Previously the responsibility would have been that of the credit card company. Byrne says he had heard that the new technology was coming, but expected that he’d be able to opt in if he wanted to.

You may also need a PIN: Two to three years from now, chip cards will likely operate more like debit cards. Jennifer Fidlon-Bugat, a freelance writer in Montclair, New Jersey, says she has been able to use her chip card only once – at Target.

You may receive an EMV card from each issuer in the near future, if you haven’t already. The adoption of EMV in a retail store is important, because this sophisticated system helps to thwart security hacks by an estimated 70%, according to New Science. Even though she already has a credit card with a chip, Fidlon-Bugat plans to stop by her bank before she travels to France and get an EMV-enabled ATM card as well.

“The card’s gonna have to be inserted into the reader and left there for the duration of the transaction so that’s gonna take a little bit of patience”, says Vawter. Issuers hope consumers will barely notice the change. And as these cards arrive in the mail, we’re getting more questions about how they work and the benefits they provide. Whatever you call it, they all have microchips embedded in them.

If you haven’t received one yet, there’s a good chance you’ll receive one soon. So chip cards generally offer both a chip and a magnetic stripe so you can still use the card wherever you shop, even if the store has not yet installed chip readers. EMV cards handle transactions much differently from traditional cards that store data only on a magnetic stripe.

You insert the card, and he new machines encrypt the chip’s data and actually verify it to make sure it’s authentic. “If that transaction data is stolen by criminals, it can’t be replicated and reused the way a magstripe transaction could”. Whichever party, the retailer or the credit card institution, is more liable for putting the consumer at risk will take on the financial burden of the theft.