August 9, 2016
If you have a debit card or a credit card then there is a great chance you have been sent a new “chip card” or EMV. And if you have been sent a chip card odds are that you have had to use one at a grocery or convenience store. These right now are just about the only places that use are able to process the chip. Other stores you probably are still have to do the old fashioned swipe. Right now the chips can be confusing and the machines reading them can be clunky and sometimes fail and have you end up swiping anyway. So you may be asking yourself “what is the point of the chip card anyway”.
The Point of Chip Cards
If you remember in the news or even on our blogs here over the last few years there have been many mentions of credit card information being stolen from departments stores and gas stations. Target alone had about 40 million account numbers stolen. The reason for this has to do with the magnetic strip on the back of your card. That technology is severely outdated and basically is the same level as a VHS which no one has used almost 20 years. The magnetic strip first came to be in the 60s so you can understand just how old this technology is. The problem with the magnetic strip is that it stores all your banking information on it and gives it to the seller every time you use it. So if a person has a “skimmer” on a credit card machine then they can easily steal your account. With a chip card however, the information is encrypted and actually changed and scrambled every time you use it. This makes it much harder for people to steal your information.
This Is a Good Thing
With about a million stores right now in the country able to read the chips the FBI is already seeing a dramatic drop in theft and expect that to continue as more and more stores catch up. The plan is to actually phase out the magnetic strip on your card completely over the next few years. So while right now it may take a while to get used to switching over just know that this is a good thing and something that should have actually happened years ago.