Credit cards have chips for added security. Also known as EMV cards, these credit cards have a small metallic microchip that card readers use to process transactions. During payment, the microchip generates a unique code for the transaction which cannot be used for future purchases.
Some older credit cards have only a magnetic stripe to swipe for payments. This stripe generates the same information for each transaction, leaving the card more at risk for fraud. Credit cards in the U.S. with chips are still issued with magnetic stripes as a backup since chip-enabled card readers aren’t offered everywhere just yet. That’s largely because they’re so expensive.
When a card reader lacks chip technology, you’ll be asked to swipe your card using the magnetic stripe. In those cases, your card is less protected than if you could “dip” your chip instead. All major credit cards have $0 fraud liability policies, meaning you won’t be held accountable for fraudulent purchases. But you don’t want to go through the process of reporting and correcting fraud, so you should use your credit card’s chip whenever possible.
Credit cards with chips come in two major varieties: chip-and-signature and chip-and-PIN. Chip and signature cards aren’t quite as secure, but they’re still more widespread in the U.S.
In practical terms, credit cards have chips because U.S. card networks and issuers have taken big steps to make sure cardholders are able to use EMV chip technology. Merchants are also liable for fraudulent charges made with swiped credit cards (but not “dipped” chip credit cards) now, so there’s an incentive for merchants to make the leap to chip card readers.
A chip-and-PIN credit card works a lot like a traditional debit card at an ATM. However, when making purchases, rather than swiping a magnetic stripe credit card, you insert (or “dip”) a chip-and-PIN card into a payment terminal and follow the prompt to input your PIN. The PIN is then compared to information stored on the embedded computer chip, and the transaction is either approved or denied.… read full answer
Such transactions are the norm in many countries and are becoming increasingly common in the United States, as the country transitions to EMV payments. But chip-based cards still come with magnetic stripes because there are many places where you won’t be able to use the chip-and-PIN feature. You will have to swipe your card, like with a normal credit card.
You should have received a PIN with your card, but you can always set it up later or change it by getting in touch with your credit card issuer.
Feel free to check out some of the best chip-and-PIN credit cards and pick one according to your individual needs and credit standing. You can use the filters on the left sde of the page to sort the cards according to your preferences.
Chip cards can be skimmed because of the magnetic strip that still exists on these cards. Skimming is a common scam in which fraudsters attach a tiny device, or “skimmer,” to a card reader. They tend to target places like ATMs and gas stations. When you use your card at one of these readers, the device intercepts and copies sensitive card information from the magnetic stripe. Thieves can then retrieve the stolen data and can either clone the card or sell the card number to other scammers. Information on a chip card’s embedded microchip is not compromised.… read full answer
Magnetic strip cards are inherently vulnerable to fraud. Their flaws have led to the transition to chip-enabled, or EMV (Euro, Mastercard, Visa) cards, which offer tighter security measures to combat potential fraud and identity theft. However, many merchants in the U.S. still lack readers that can effectively process chip card transactions. As a result, credit cards and debit cards are still issued with magnetic stripes, and the security risks that come with them.
With that being said, all the major credit card networks offer a $0 liability guarantee for fraudulent credit card transactions. If your chip card is ever skimmed, you won’t be responsible for any fraudulent charges. In addition, federal law limits your liability to $50 if you report any fraudulent charges within 60 days of them appearing on your credit card statement.
You only need a PIN if you plan to use your card for cash advances at ATMs or to make purchases at automated kiosks, such as you might find in train stations or parking lots, when traveling abroad. Otherwise, no PIN is necessary.… read full answer
To request a PIN, you will need to call the number on the back of your card.
WalletHub Answers is a free service that helps consumers access financial information. Information on WalletHub Answers is provided “as is” and should not be considered financial, legal or investment advice. WalletHub is not a financial advisor, law firm, “lawyer referral service,” or a substitute for a financial advisor, attorney, or law firm. You may want to hire a professional before making any decision. WalletHub does not endorse any particular contributors and cannot guarantee the quality or reliability of any information posted. The helpfulness of a financial advisor's answer is not indicative of future advisor performance.
WalletHub members have a wealth of knowledge to share, and we encourage everyone to do so while respecting our content guidelines. This question was posted by WalletHub.
Please keep in mind that editorial and user-generated content on this page is not reviewed or otherwise endorsed by any financial institution. In addition, it is not a financial institution’s responsibility to ensure all posts and questions are answered.
Ad Disclosure: Certain offers that appear on this site originate from paying advertisers, and this will be noted on an offer’s details page using the designation "Sponsored", where applicable. Advertising may impact how and where products appear on this site (including, for example, the order in which they appear). At WalletHub we try to present a wide array of offers, but our offers do not represent all financial services companies or products.