No matter how careful you are with your credit and debit cards, your personal information is always at risk of fraud from skilled hackers determined to steal your personal information. You may keep your wallet under lock and key, but if the Target breach during the shopping season of 2013 taught us anything, retailers may not be as careful with your personal information as you are. During that breach, hackers gained access to Target’s customer database and the personal information of 60 million people, including 40 million unique card numbers.
The event encouraged banks and financial institutions to begin adopting EMV chip card technology, a system that has been used in Europe for as far back as 1992. EMV is named for Europay, MasterCard, and Visa, who were the original developers of the technology. Banks in the U.S. recognized the need to protect consumer information and started to convert their credit and debit cards to EMV technology. They also encouraged American retailers to replace their card readers with special EMV chip-and-PIN terminals. You’ve probably seen these terminals at many of your favorite stores.
Finger Lakes Federal Credit Union was one of the first financial institutions in the area to make the switch to EMV chip technology.
Your FLFCU debit or credit card has more power to fight fraud than many other cards issued in the U.S.
You’ve probably run into some confusion when shopping with your new card as retailers and consumers alike adjust to the secure, but slow-paced method of shopping with an EMV chip card. If you still have questions about using your new EMV chip card, we attempt to answer them here:
Magnetic Strip vs. Chip Technology
You are familiar with the magnetic strip on the back of your credit and debit cards. Your EMV chip card has one as well. The magnetic stripes hold your card’s data, but the data is unchanging. Whoever accesses the data on a magnetic strip immediately gains access to the cardholder’s purchase information. They can then use that information to make unauthorized purchases. Magnetic strips are also easy to copy, replicate, and sell. If your magnetic strip is copied and sold, countless thieves could gain the ability to make purchases using your private information.
EMV technology makes it more difficult for criminals to copy and profit from your stolen information. Unlike magnetic strips, the data stored in a chip card is constantly changing.
Chip cards create unique transaction codes for every purchase that cannot be used again, so they cannot be copied and sold.
Visa has reported that since adopting to EMV chip card technology in 2015, chip-enabled merchants in the U.S. have reported a 47% drop in counterfeit fraud. MasterCard recorded a 54% decrease in counterfeit fraud cases from chip-enabled merchants between April 2015 and April 2016.
The conversion process to EMV chip technology is still in the messy middle phases. You’re lucky as an FLFCU member to already have an EMV chip card, but many other consumers are still waiting and retailers are still in the process of adopting chip-and-Pin terminals. This may have made it confusing at the checkout on more than one occasion.
So how does shopping with an EMV Chip card work?
Your EMV card is equipped with both chip and magnetic-stripe functions, so it will work at any retailer, even those who don’t have chip-and-Pin terminals. In this situation, you will swipe your card as normal and either enter your pin or sign, depending on whether you’re making a debit or credit purchase.
If the retailer does have a chip-and-Pin terminal:
- Instead of swiping, insert the card into the front of the card reader with the chip facing up.
- Do not remove the card from the reader. Keep it there and follow the prompts on the screen until your transaction is complete.
- Remove the card. If a signature is required, you’ll be instructed to sign the receipt.
We found some other helpful purchase facts and tips:
- You won’t be able to choose “credit” on a chip-and-Pin terminal. This may be frustrating, but your chip card is more secure when you use it with a PIN.
- If someone steals your physical card, they won’t be able to use it in a chip-enabled physical retail store unless they also know your PIN.
- Gas stations have until 2017 to switch to chip-and-Pin terminals, but other retailers are already supposed to have adopted the technology.
- The microchip produces a unique one-time digital authentication code for each transaction when the card is verified with the user’s PIN. That means the retailer won’t even know your actual account or card number, meaning it can’t be hacked and stolen later.
Black Friday and Cyber Monday are only a few weeks away and shopping madness has already begun. The Holidays should be spent enjoying the company of family and loved ones, not spent worrying about who may be copying and selling your private information. Don’t you feel better knowing that this year, you’re new EMV card from Finger Lakes FCU is helping to protect you from fraud and identity theft?