Chip and PIN Credit Cards

The United States is currently in the process of switching from standard magnetic stripe credit cards to chip cards and chip-based payment terminals. Any new credit card you get now will have a chip in it. But most chip cards in the U.S. are chip-and-signature, not chip-and-PIN. U.S. chip cards also still come with a magnetic stripe because not all merchants have chip-card readers.

With that being said, we can expect to see more and more chip-and-PIN credit cards on the market in the years to come, as the country’s payments infrastructure continues its overhaul. They’re the most secure type of credit card, after all.  

Chase Sapphire Reserve® is not a chip and PIN card, it’s a chip and signature card. When it’s time to pay, you’ll have to insert your card into the machine (or sometimes swipe it), and then you may be asked to sign the touchpad or receipt to confirm the transaction. But you can still use Chase Sapphire Reserve most places that accept credit cards around the world, including most terminals equipped to accept chip and PIN cards. Chip and PIN is common in a lot of countries, like pretty much all of Europe, Mexico, Canada, South America and Asia. And Chase says Sapphire Reserve cards will work fine there.

Here’s how to use Chase Sapphire Reserve with chip and PIN terminals:

• U.S. terminals often require only a swipe or chip insertion. And if they ask for further verification, it’s typically a signature, not a PIN.
• If you encounter a merchant who asks for a PIN, Chase says to tell them your card doesn’t need one. 
• If an unmanned kiosk asks for a PIN, you should be able to bypass it by pressing “Cancel,” “Enter” or “Continue.” 
• If the merchant or terminal really won’t take your card without a PIN, you may have to just pay in cash or use an alternate card. 

It’s also good to note that if you’ve been a Sapphire Reserve cardholder for a long time, you could have an older version of the card that only has a magnetic stripe. If you request a replacement card, the new one will come with a chip. You can request a new card by calling Chase customer service at 1-800-935-9935 or by logging in to your online account.

A chip card is more secure than a standard magnetic stripe card because the chip is harder for fraudsters to copy. But chip cards are not all equally secure. Chip-and-PIN credit cards are more secure than chip-and-signature credit cards because it’s harder for someone to guess your PIN than to forge a signature.

Still, chip cards are not completely secure. And their security advantage over magnetic stripe cards might not affect your wallet as much as you might think.

For starters, all of the major credit card issuers provide $0 fraud liability guarantees to their customers. That means you won’t have to pay for unauthorized transactions if a fraudster ever gets his or her hands on your account information.

Secondly, all chip cards currently have magnetic stripes. This is to prevent usability issues in the United States, where chip-enabled payment terminals are not fully rolled out yet. But it also introduces security vulnerabilities. Special encoding on a chip card’s magnetic stripe makes a copied version useless at a chip-enabled payment terminal, according to Randy Vanderhoof, executive director of the Smart Card Alliance. However, that won’t necessarily be the case on a standard point of sale machine where your card is swiped.

With that being said, chip-and-PIN credit cards are the only credit cards with which you can expect to encounter no difficulties when traveling around the world. Not only will they work at offline payment terminals, but they’re also more familiar to foreign merchants, who might balk at swiping a magnetic stripe card.

A chip-and-PIN credit card works a lot like a traditional debit card at an ATM. 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.

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.