Chip Card Technology Brings Increased Safety to Your ATM & Check Card

I’m willing to bet you recently received a replacement card for one or more of your credit or debit accounts. The card probably had a shiny silver or gold microchip on the front. Recently, we too sent out thick envelopes with new Hanscom ATM & Check Cards for our members.

You’ll be happy to know that this is a positive change. The chip is actually a tiny computer circuit, and it’s designed to deter fraud. Chip technology had been the norm in many other countries for the past 30 years.

The chip significantly alters how your card interacts with terminals at stores and ATMs. Instead of storing static data the way a magnetic stripe does, the chip creates a unique code each time that cannot be used again.

If a hacker compromises the system as a retailer, they won’t be able to use the information to make unauthorized purchases. Why? Because the unique code created at the time of purchase adds a dynamic element that can’t be duplicated.

Fortunately, chip technology will only slightly change how you use your card. Instead of swiping your card, you will “do the dip.” Insert your card in the reader, and leave it in until the transaction is complete.

It may take a bit longer to transfer the data, but it’s not significant. Think of it as an opportunity to complete the transaction without having to jam your card back in your wallet at the same time.

The chip is safe to use. If you’ve heard rumors that chip cards are using GPS to track your movements, or they emit a signal that can be picked up by anyone carrying a laptop, you can relax. It won’t beam out a signal as you walk down the street or allow marketers to send ads to you as you pass by.

There is another element to this conversion. With increased security at check-out, big credit card companies are shifting liability for fraudulent purchases away from the retailer to whichever party is not EMV compliant.

It’s like a game of hot potato. No one wants to be left with a burning, costly problem like credit card fraud. However, there are costs to convert to EMV compliant terminals. Those who experience fewer problems with fraud, such as a small shop or restaurant with clients they know personally, will be less likely to invest in the technology.

Personally, I’ve had varied shopping experience. On trips to Walgreen’s, Target, Walmart, and Whole Foods, my chip card worked like a charm – while my hair salon still asks me to swipe my card. I don’t expect this will change anytime soon, but time will tell.

If you are a business owner, you might be interested in our recent publication, 11 Things Business Owners Should Know About Chip Cards.

If you have questions about our chip card, check out our web page and FAQs, or watch this video we’ve put together.

 

 

 

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Hanscom Federal Credit Union
Hanscom Federal Credit Union

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