Card Technology to Protect Consumers
If you're wondering what that new chip is on your credit or debit card, you are not alone. It is a tiny piece of technology called an EMV chip that will make a big difference in card security. Paying with a chip card instead of a magnetic stripe card brings added security for your in-store transactions (unfortunately, it doesn't add any protection to shopping online). So, what's the difference between the old cards and the new? Below are a few key differences for consumers to be aware of.
How to tell if your card has a chip
During the transition to EMV, all U.S. chip cards will still have the magnetic strip on the back of the card. They are the same size and material as the old cards, too. The difference is that chip cards have a reflective rectangle on the front of the card, usually placed above the first four digits of the card number.
Chip cards are more secure
Chip card transactions provided better security for in-store transactions and at the ATM by making every transaction unique. The embedded microprocessor chip in the card communicates with the card reader device to authenticate the card, reducing the possibility that someone illegally copied the information from your card to create a fake one, and create a one-time code for the transaction. If the card data and the one-time code are stolen, the information cannot be used to create counterfeit cards and commit fraud. The new cards come in two varieties: chip and signature or chip and PIN. When you received and activated your new card, if the system did not require you to create a PIN, then you have a chip and signature card.
Stick, don't swipe
Finally, the way you use chip cards is slightly different from how you use magnetic strip cards. Instead of swiping the magnetic strip on the back of the card, insert the card into the terminal (or ATM). Be sure that the chip is facing up. You then leave the card in the terminal until the transaction is complete and you've entered your PIN or signature. The device will then prompt you to remove the card. If you're not sure if the terminal or ATM you're using is chip-enabled, swipe the card. The terminal will prompt you to insert it if it is chip-compatible. Like magnetic strip cards, you can also use chip cards to make online purchases, though they offer no enhanced security features in that space.
Consumers can also visit www.GoChipCard.com to learn more about how EMV cards offer better security and how to use them.
Source: "New Card Technology to Protect Consumers" Consumer Column, Wisconsin Bankers Association
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