EMV Chip Cards

If you’ve used your debit or credit card at all in the last 12 months or so, you’ve probably done the dance between swiping or inserting your card into the terminal. It’s been a slow transition and at times a trying one, but First South Bank and the credit companies really do have your best interest at heart. So, why DO you need a chip enabled card?

Credit Fraud Facts

More than half of the credit card fraud in the world occurs in the United States, even though only a quarter of all credit card transactions occur here. Consumers and financial institutions alike want to reduce this statistic in a dramatic way. In the wake of several large scale credit/debit card breaches and a significant increase in counterfeit card fraud, the gold standard of the industry is becoming the EMV card. EMV — which means Europay, MasterCard, Visa — cards are embedded with a computer chip which authenticates each credit transaction. The chip appears as a small square on your card that can be seen both on the front of the card and back.

Customer inserts credit card into a chip-enabled card reader while merchant looks on.

You may have already gotten your new EMV equipped card, and you may have   already noticed while out shopping that many retailers will ask you to insert or “dip” your card into the terminal. This does require a little patience, because unlike a quick swipe which reads the magnetic strip on the back of the card within seconds, dipping requires you to leave your card in the terminal until the end of the transaction. The process lasts several seconds longer than the traditional swipe. This is because the system is reading your chip, verifying the card with your financial institution and creating a unique transaction code that cannot be replicated by counterfeiters. Even if they do manage to copy it from a specific point of sale, their card will be denied by other chip reading terminals. EMV technology will not stop breaches from happening, but it will make it much more difficult for the hackers to profit from what they steal.

Card-dipping is not Your Only Option

You can still utilize the magnetic strip at terminals that are not equipped to read your chip. However, if their reader is chip enabled and you have an EMV card, your magnetic strip will not swipe. You will be required to insert your card. This means longer lines while Christmas shopping, but more protection for your wallet. You will still need to sign or enter a PIN for your purchases depending on your card requirements.

What about online shopping?

Middle-aged man paying bills on his laptop with a credit card.While EMV cards are expected to significantly reduce counterfeit cards, they cannot protect you against online credit card fraud and identity theft. So, you still need to be vigilant about protecting yourself when you are shopping online. Make sure that when you are making online purchases, you are doing so from reputable retailers and secure sites (https://).

If you find a too-good-to-be-true deal on a website you’ve never heard of, you are probably treading on dangerous ground. Also, while it is certainly convenient to store your credit card information on your favorite shopping website, it’s not advised that you do so. Your information will be stored in the database and is susceptible to being hacked. Using a credit card when making online purchases is recommended over the use of debit cards as your liability is far lower when you use credit in the event of fraud. You should also avoid using the same password for multiple websites and accounts.

The Bottom Line

So, as if things weren’t hectic enough when shopping, now you may end up being REALLY confused at the check-out line. Do you swipe quickly? Or dip slowly? Lines may be longer with the added transaction time of processing chip enable cards. Retail employees may not be proficient in their understanding of the chip card and terminal. Things could get a little CRAZY! But, the bottom line is that this transition is taking place for the protection of you, the consumer. All you have to do is activate your new card and have a little patience. Rest easy — we’ve got your back.

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