EMV Chip Cards – Here’s what you need to know!
What is a Chip Card?
EMV (Europay, MasterCard, Visa) is a technology that embeds a microchip into your credit and debit cards. At the time of purchase, the embedded EMV chip transmits a one-time code, so your credit or debit card information isn’t really part of the transaction, making it harder for hackers to intercept your information and make illegal duplication of the card.
Why a Chip Card?
EMV technology will no longer allow you to swipe your card during transaction. Instead, you will insert your card into the reader slot for processing and either enter a 4-digit PIN or provide a signature.
According to the Federal Reserve, with Chip and Pin there is a 700% reduction in fraud compared to signature-based cards. In the first five years after the UK started using Chip & PIN (2001), fraud dropped by 70%! During that same time period, the cost for fraud in the U.S. doubled!
When is it happening?
Next month! October 15, 2015 is the deadline for businesses to replace existing credit and debit card readers with EMV card readers. If a business fails to implement the new card readers and fraud occurs, then the financially liability will shift from the issuing bank to the merchant. It’s estimated that by the end of 2015, 70% of U.S. credit cards and 41% of U.S. debit cards will have EMV technology enabled.
How do you use a Chip Card?
The U.S. will implement EMV technology over two phases:
Although Phase 1 will make credit cards harder to clone, it WILL NOT make them harder to use if they get into the wrong hands. Therefore, continue to closely monitor your accounts and personal information to help you avoid becoming a victim of fraud. Phase 2 implementation WILL make credit cards harder for thieves to use, which is even more reason to support the transition to the new technology.