Credit card issuers across the United States are now actively transitioning from the old magnetic stripe credit cards to newer EMV cards with "chip" technology. These new credit cards come with added security to protect cardholder data. Learn about chip technology and an important deadline businesses need to be aware of.
Why are EMV cards more secure? It’s all in the technology.
The old magnetic stripe technology was easy for thieves to obtain secure credit card information and use it for unintended purposes. From tiny devices criminals were able to physically install in gas pumps, to the online use of someone's 16-digit account number, these cards are more prone to fraud. EMV technology still has a 16-digit account number but there is more in the chip to further protect cardholder data.
Imagine there is a “key” in your card that holds specific information that identifies your account and information that is uniquely yours. When the card is read, it sends that information to the processor, which holds the other part of the key that verifies and completes the transaction. There are also algorithms and other technologies incorporated into the chip card and terminals that make this a significant step forward in fighting fraud.
October 2015 Deadline
In order for chip cards to work, businesses need to have terminals that read both the mag stripe cards and chip cards. Most reputable merchant processors are only issuing chip-enabled terminals to new customers. Businesses with existing terminals will be required to have EMV terminals by October 2015 or assume responsibility for fraudulent transactions.
It’s an exciting time in the payments business, and we’re committed to providing our customers the EMV chip-reading equipment necessary to help that with this transition.