An estimated 850 million-plus EMV chip debit and credit cards have been issued to Americans since their introduction in 2017. EMV chips are a unique technology that provides a wealth of benefits, including more secure transactions, contactless payments, and more. Here’s everything you need to know about EMV chip credit cards and the benefits they provide to consumers.
How Do EMV Chips Work?
EMV chip cards were first introduced in Europe in 1996. “EMV” is an abbreviation for Europay, Mastercard and Visa, the three creators of the original chip card. The goal of EMV technology is to combat mounting losses related to the use of counterfeit and stolen credit cards.
Do All Credit Cards Have EMV Chips?
While EMV chips are becoming more popular among U.S. banks and credit card issuers, not every debit or credit card features an EMV chip – yet.
EMV chips first arrived in the United States in 2017, but the technology has a much longer history in Europe, Asia, and other parts of the world. Many issuers have updated their credit and debit cards to embrace the new technology, but the price of upgrading all credit cards to feature EMV chips means some cards still rely on magnetic strips solely.
What Are the Benefits of EMV Chip Technology?
Given the costs of upgrading to the new technology, what are the benefits of using EMV chips when making purchases?
Greater Security
EMV chips are more secure than magnetic strips. Magnetic strips on traditional credit cards store an unchanging set of data. If an identity thief can copy a credit card’s magnetic stripe, they can replicate that data repeatedly, leading to fraudulent charges.
The EMV chip, on the other hand, only deals with purchases. The chip technology creates a unique code for every transaction, meaning a thief stealing the data from a chip transaction can’t duplicate the code for future purchases.
Easier International Purchasing
The United States is the only significant market still relying on older magnetic stripe technology. Many European and Asian countries adopted EMV technology years ago to help combat fraud.
Using a credit card with an EMV chip makes using credit cards abroad a breeze. Cardholders won’t have to worry about a foreign merchant’s card reader being incompatible with their card – while also enjoying enhanced security against identity theft.
Contactless Payments
EMV chips allow for purchases either through dipping (or inserting) the card into a card reader terminal, swiping the magnetic strip, or through contactless payments.
Contactless payments are also a popular payment method gaining more traction thanks to the coronavirus (COVID-19) pandemic. Contactless payments work by integrating a credit card through a mobile wallet, like Google Pay, Apple Pay, Samsung Pay, PayPal, Amazon Pay, and more. These payments can also be made by tapping the card’s EMV chip against the card reader at any eligible merchant.
Featured photo by Nicole De Khors / Burst
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