Tax service in eastern Virginia

phone icon757.926.5353

The EMV Switch


The EMV Switch


This new payment card technology touts higher security…Is is true?

A new type of payment card has been making the news—EMV cards (short for Europay, Mastercard, and Visa). These cards have been used around the world for years but are just beginning to make their debut in the United States.

By October 2015, all credit card companies, banks, and merchants must make the switch to EMV technology. Credit cards and banks must issue new cards with EMV chips to their customers and merchants must switch to payment systems that can read EMV cards.

So what exactly is EMV technology?

EMV cards contain a small computer chip that creates a new code for every transaction. Once that code is used, it cannot be used again which helps cut down on certain types of fraud. In comparison, current credit and debit cards in the U.S. produce the same code every time the card is used (stored on the magnetic strip) which allows fraudsters to easily duplicate cards.

There are two types of EMV cards—”chip and PIN” and “chip and signature.” Chip and PIN cards require you to enter your card into the chip­-enabled terminal and then enter your PIN to finish the transaction. Your card would not be ejected from the terminal until the transaction is complete. Chip and signature works the same way—but rather than entering your PIN, you must sign to complete the purchase.

Chip and PIN cards are considered the more secure option, but the majority of EMV terminals in the U.S. will only be able to accommodate chip and signature transactions. This option is more secure than the magnetic strip cards, but requiring a PIN would cut down on fraud even further. Merchants and banks were concerned that requiring consumers to enter a PIN for each transaction would be too time consuming and would turn people off from using their cards.

What will they do?

EMV cards are being introduced to cut down on the growing fraud problem in the U.S.—however this switch will not stop all fraud. In fact, EMV cards are only useful in stopping in-­person fraud. Due to the computer chips that create unique codes for every purchase, EMV cards cannot be successfully duplicated and used.

For example, if you used your EMV card at a store that suffered a data breach, it would be difficult for a physical, counterfeit card to be created with the information on file. The one time transaction code will be stored but that code will not work again. So while EMV cards will not stop data breaches from occurring, they will lessen the profit that thieves currently make from duplicating and selling physical cards in the underground market.

But, a thief could use your EMV card information stolen in a breach to make online purchases. The chip technology is not used during online purchases since you are not physically entering your card into a chip­enabled payment system machine. Therefore, the thief would only need your card number, security code, and expiration date.

Almost every country that has switched over to EMV technology has seen a surge in online fraud.

What you should know (and do).

Be aware that these changes are coming – in fact, you may have already received one of these new cards in the mail. Remember that this new technology won’t protect you from fraud on its own – you need to take action yourself.

A good first step is signing up for instant text or email notifications for your new EMV cards. By doing so, you will receive a notification every time the card is used. This is a quick and simple way to catch and stop fraud in its tracks.

Information in this article was provided by the Savvy Cybersecurity Newsletter by