The days of swiping your card in the checkout line may soon be a thing of the past, thanks to EMV chip-enabled credit and debit cards. EMV stands for Europay, MasterCard, and Visa, the three companies responsible for bringing chip-technology standards to the market. If you have a chip-enabled card, you’ll see a visible microchip on it.
First PREMIER Bank credit card customers started receiving chip-enabled cards in April 2014. All credit card customers will have a chip-enabled credit card by August 2016. So what does this mean for you?
This chip is meant to replace magnetic stripes on cards to prevent counterfeit transactions during in-store purchases, which magnetic stripes cannot combat. These chips benefit customers, merchants, and card issuers. However, there are a few things you should know in order to make the most of your chip card.
EMV chips protect your card information.
According to MasterCard, chip cards and payment processors in the U.S. had already reduced card counterfeiting by 37% in January 2016 when compared to the previous year. Counterfeiting is what EMV chip cards help prevent.
The old magnetic stripes that you swipe to pay use the same information to create a transaction each time. However, the chip generates a unique code for each purchase. This makes it almost impossible for a counterfeit transaction to take place in the store. So while the chip card reader may take a few more seconds to process than the swipe reader, it’s protecting your credit card information.
CHIP + PIN technology works best.
A PIN and your card chip go hand in hand to protect your information. This PIN confirms your identity, providing an added layer of security. When you insert your chip card into the terminal, you may be prompted to enter your PIN instead of your signature to complete the purchase.
First PREMIER Bank cardholders:
You need to have a PIN to use your chip-enabled card. Don’t have a PIN? Call 1-888-891-2435 to select or change your PIN.
EMV chips are only good if you use them.
Many retailers still have the option to swipe or use the chip card reader when processing purchases. However, the chip protection only works if you use it. If a retailer has both options, always opt to pay using your chip versus the magnetic stripe.
Not only does this protect your information, but it can also protect your local retailer. How? Say you love shopping at a mom-and-pop kitchen store. If you have a chip card, but you decide to pay using your magnetic stripe instead, the store owners could be held liable for fraudulent transactions.
In October 2015, the liability shifted in the event of a fraudulent purchase. It used to be that the credit or debit card issuer would absorb the cost of unauthorized purchases. Now, businesses that do not process transactions using the chip will have to pay for a thief’s malicious activity if a customer has a chip card. If fraud occurs when a chip card and chip reader is used, the store owner is not liable. The store is also in the clear if the shopper only has a magnetic stripe card.
Even if you, the customer, aren’t held liable for fraudulent purchases, you still have to go through the hassle of reporting it to your card issuer, and potentially the police. You may also have to wait to get your funds reimbursed or credit limit readjusted while an investigation takes place. So it makes sense to do all you can up front to protect your information.
Do your part and use the chip every time it’s possible.
Not sure how? It’s easy.
- Insert your card chip first into the chip terminal. Don’t remove it.
- Follow the prompts on the terminal and wait for the transaction to be processed. You may have to enter your existing PIN or sign.
- Remove the chip card after the transaction is approved and the reader notifies you that it’s OK to remove it.
You can still shop anywhere credit cards are accepted as most chip cards still have the magnetic swipe stripe. This way, merchants who still need to upgrade their payment terminals can still accept your payment.
EMV chips help reduce fraud problems.
Countries in Europe and other places around the globe implemented chip technology years ago and have already seen a dramatic decrease in counterfeit card fraud. So if you travel to Europe, you may see chip card readers in more places than in the U.S.
There are still many different types of fraud, though. EMV chip cards only address point-of-sale fraud, or in-store fraud from counterfeit cards. Also, many ATMs and gas station pumps have yet to make the upgrade to the chip reader, so you still need to look for potential card skimmers in these places.
Protect your payment and personal information. Don’t give your PIN to anyone or write it down. When you’re entering your PIN, try to cover the keypad with your hand to shield it from bystanders and potential skimmer cameras.
You also still need to be diligent about protecting your card online and over the phone. Check your bank and credit card statements and account summary often. If you suspect fraud, report it immediately.
Learn more about protecting your credit card online on the PREMIER Perspectives blog. The FTC also has a wealth of resources you can use to protect yourself. Stay informed and alert to know you’re doing all you can to prevent fraud.
This information is presented for educational purposes only. It is not intended as, nor should it be construed to be, legal, financial or other professional advice. Please consult with your attorney or financial advisor to discuss any legal or financial issues involved with credit decisions.