You may have heard that credit card processing in the United States will be changing as of October 15, 2015 as chip and pin credit card technology enters the mainstream. However, for many, the details are fuzzy. The following are questions posed by our clients about this new weapon in the fight against credit card fraud.
- What is Chip & Pin technology and why is it being introduced in the United States?
Credit card fraud has reached epic proportions in the United States. It’s almost impossible to read the paper without learning of a new breach. To make matters worse, while the US accounts for one quarter of global credit card use, half of the credit card fraud occurs in this country. Many attribute this to the fact that unlike Europe, Canada, Latin America and the Carribean, we have not yet moved from magnetic swipe cards to the more secure Chip & Pin technology.
Chip and Pin Credit Cards , or EMV (named after Eurpopay, MasterCard and Visa, the originators of the standard), was first introduced in Europe in 1999. These credit cards contain a computer chip embedded in the card which is read at the point of sale.
- Why are EMV cards more secure than magnetic swipe cards?
Magnetic swipe cards contain unchanging data. Whoever has access to that data can replicate the original card and make unauthorized purchases at point of sale. In contrast, the chip embedded in an EMV card creates a new, unique code for each transaction. This means that stolen information from one transaction cannot be used a second time when a counterfeit card is presented at the point of sale. [Read more…]