According to statistics, almost half of the world’s fraud happens in the United States although only quarter of all credit card transactions happen here. This has prompted the responsible bodies to come up with solutions to counter the menace leading to the introduction of EMV technology on credit cards. EMV (Euro-pay, MasterCard and Visa) technology involves the embedding of small computer chips that are extremely hard to counterfeit on the front of the card.
WHY THE EMV CHIP CREDIT CARDS?
They present reduced identity theft. While copying a magnetic stripe, the current technology on traditional cards, is an inexpensive and simple thing to do, copying a chip is more complicated and expensive. The microprocessor chips are virtually impossible to duplicate. This means thieves can’t simply take account numbers stolen from a breach and emboss them onto the magnetic strip of a random card to make fraudulent purchases at stores or withdrawals at ATMs. Fake chip credit cards are thus harder to make for them.
Though the liability in case of fraud has shifted, the card holder is still protected by the Fair Credit Billing Act. The liability has shifted from the credit card companies to the merchants whose terminal won’t be updated to read EMV chip credit cards. Although the card user still has the responsibility of checking to ensure no fraudulent activity is carried out on the card, they cannot be held responsible for more than $50 charged on the card fraudulently.
EMV chip credit cards that use PINs are universally accepted making it easy for Americans who possess them to transact while overseas. They have been in use in almost every part of Europe, Canada and Africa among others. Excluding the United States, half of all payments cards are chip cards and 74% of all terminals in those places read the chips. The presence of the EMV chip gives merchants more confidence in the security of the transaction.
The use of chips is more secure since they require more authentication. Thieves cannot use your stolen card since it requires a PIN or a signature as proof of ownership. Although currently the cards being introduced require a signature, with time the use of PINS will be introduced which is more secure. However, the traditional magnetic stripe cards cannot measure up to the security standards found in EMV chip-signature cards.
One can still swipe the chip enabled card using the magnetic stripe on the back of card at terminals where merchants haven’t yet updated them. However, if it is chip activated, it will prompt you to insert the card into the chip slot. The card holder is therefore not inconvenienced into carrying different credit cards while shopping.
Lastly, the chip credit cards can still be used to shop online and over the phone safely. This translates into ease of transacting even across distances. Some can also support contact-less payments using NFC for small inexpensive purchases which are in real sense a safer option.
While EMV chip credit cards are not a guarantee to safety from online fraud, it is a major step in preventing credit card fraud. Consumers still need to be careful to monitor account activity, set up alerts and report possible fraudulent use quickly. In the event that you fall victim, a reputable credit repair company can help.