Have you noticed the metal square on the front of your new card, just above the card number? That is the protective overlay for the EMV Chip. The EMV chip credit card – named for Europay, MasterCard, and Visa, the companies who created the standard – is a safer type of credit card. Similar to the magnetic strip on your old credit cards, the chip on the EMV credit card holds your credit card information and transmits the information to payment processors in a way that’s tougher for criminals to hack and use. The EMV chip credit card is also referred to as chip-and-PIN or chip-and-signature credit cards.
How to Use Your EMV Chip Credit Card
When you’re making a purchase with an EMV chip credit card at an EMV-enabled terminal, there’s a slot below the numeric keypad where you “dip” your credit card. Place your credit card into the slot and follow the prompts on the screen. You must leave your card there until the transaction has processed; it’s not a swipe-and-go motion like with the magnetic strip.
Checking out may take a little longer than you’re used to, especially as cardholders and cashiers get used to the new process. The transaction also takes slightly longer to process versus swiping your credit card for transactions.
Not all merchants will have EMV enabled, even if they have the terminal installed. If you’re at a terminal that is not EMV-enabled, whether you have an EMV credit card or not, you’ll swipe your card in one quick motion to complete the transaction.
Online purchases have the same process, even with EMV-chip credit cards. You’ll still enter your credit card number, expiration date, security code, and billing address.
EMV Cards Don’t Currently Require a PIN
Though EMV Card is often interchanged with chip-and-PIN. This new version does not require you to enter a PIN for your credit card transactions. Instead you’ll sign for your credit card purchases, more like chip-and-signature.
If your card is also contactless, you’ll see a contactless symbol on the front of the card. You can simply tap your credit card on the credit card reader to complete your transactions.
What Makes EMV Cards Safer to Use?
The two major reasons for the switch to EMV credit cards are mainly to reduce credit card fraud and also to shift more liability to merchants. They are safer than the traditional credit cards that only held information on the magnetic strip.
EMV chip credit cards contain a small computer chip that creates a unique code for each transaction and sends that code through the credit card processing system to authorize the transaction. After the code has been used, it can’t be used again. So, if a hacker gets access to this code and attempts to use the data for credit card purchases, the transaction would be declined since the code has already been used.
Chip technology makes it virtually impossible for criminals to create counterfeit cards with your credit card information, assuming you always use EMV at checkout.
Is Credit Card Fraud Still Possible With EMV Cards?
Yes it is. Though chip technology is expected to reduce credit card fraud in the long-term, there’s still a risk of fraud in the short-term. Not all retailers are ready to process EMV chip credit cards. So, you’ll still have to swipe your card at some places, even if your card is equipped with a chip. Swiped credit card purchases still carry the same risk of fraud. Plus, thieves can still use physically stolen credit cards.
Gas stations aren’t required to adopt the technology until October 2020. Gas stations have been favored by credit card hackers because it’s easier to install credit card skimmers. Fraud at gas stations may increase in the next couple of years.
Online transactions still carry the same risk of fraud. Hackers may get better at phishing – tricking you into giving up your credit card information by disguising themselves as a business or person you know and trust. They may breach businesses where you’ve stored your credit card number for one-click shopping or recurring subscriptions. Continue to practice safe habits when you’re shopping online.
What You Should Do If You Suspect Fraudulent Use of Your EMV Card
All the same, credit card fraud protections still apply to consumers. Credit card processing networks, credit card issuers, merchants, and merchant banks will sort out which of them has to absorb the cost of fraudulent credit card transactions.
While the credit card industry has imposed “liability shift” rules for fraudulent transactions, this shift should be seamless for credit cardholders. Cardholders aren’t liable for fraudulent purchases made while their credit card is in their possession and face only a maximum of $50 liability on purchases made with a lost or stolen credit card.
If you suspect fraud on your account, call your credit card issuer using the number on the back of your credit card, and they will let you know how to proceed.