Best EMV Credit Cards

There are no new credit card chip laws, because the government isn’t regulating the U.S. switch to EMV, chip-enabled cards. Nobody will get arrested or fined for using a credit or debit card without a chip in it, nor will merchants face legal consequences for not updating to EMV-compliant payment terminals.

The EMV transition in the U.S. is a push by the credit card industry to stop costly fraudulent charges, because research shows that EMV is a more secure and fraud-resistant payment method. There may not be legal consequences for merchants who don’t adopt chip-and-pin payment processing, but there are financial consequences. Since October 1, 2015, merchants operating without chip-enabled payment systems have been on the hook for fraudulent charges, rather than credit card companies.

Because of those changes, chipped credit cards are becoming commonplace. In 2018, 53.5% of card-present purchases in the U.S. were made using EMV-enabled cards on EMV-compliant payment systems, according to digitaltransactions.net. That’s more than a 10% increase from 2017. And 97% of all payment value in the U.S. happens on EMV-enabled cards, according to a 2018 Visa report.

The transition seems to be achieving its intended effect, too. Merchants with EMV-enabled payment systems have seen a 75% drop in lost fraud dollars since September 2015, according to a 2018 Visa study.

For now, gas stations are the only merchants getting a pass on liability until October 1, 2020. Even though credit card fraud at the gas pump is perceived to be on the rise, the mandate gave those retailers five extra years to become EMV-compliant. That’s because EMV upgrades to gas pumps can be more costly and invasive than upgrades at other types of retailers.

The chip in a credit card is a microprocessor, or tiny computer, that makes a credit card transaction more secure. These chips, also called EMV chips, generate a unique code each time you “dip” your card into a payment terminal or tap to pay. Once used, the code - also called a “token” - cannot be used for a future transaction. So if a fraudster attempted to intercept your chip transaction, they wouldn’t get anything of value.

Physically, EMV chips are made of very thin layers of glass with small circuits embedded between them. The layers are then bonded with a gold or silver contact pad, which also serves as a protective layer. So the chip itself is actually hidden behind the gold or silver layer you see on the front of the card. The chips aren’t much different from card to card, and all are capable of generating the unique (or “dynamic”) transaction codes.

Credit card chip technology has been used in Europe and other countries since 1994. But the EMV card transition in the U.S. only happened in 2015, along with the fraud liability shift from credit card companies to merchants who continued to allow magnetic stripe transactions. All credit cards in the U.S. still have magnetic stripes as a backup measure, but paying with your chip is safer overall, so it’s best to pay with your chip when given the option.

Chip cards are safer and more secure than traditional credit cards that only have magnetic stripes. The term “chip card” refers to a credit card that has a computer chip embedded inside it. The chip is the small, metallic square on the front of any recently-issued credit or debit card. When you “dip” a chip card in a reader (as opposed to swiping a magnetic stripe card), it creates a unique transaction code.

This technology is a major security upgrade from magnetic stripes. Data stored within the stripe never changes. So it’s easier for counterfeiters to copy that information and clone it onto an illegitimate card.

But it’s important to note that chip cards do still have magnetic stripes because not all merchants have card readers capable of accepting chip cards. As a result, chip cards are not as safe as they could be. The magnetic stripe could still be copied, allowing fraudsters to make purchases where a chip is not required.

Chip cards are also known as smart cards, or EMV cards. EMV stands for Europay, Mastercard and Visa – the companies that developed the new standard for card security and verification. Chip cards play a big role in that, making payments safer for all of us.

• Difficult to clone: When you “dip” a chip card, it creates a unique code for that transaction. When you swipe a magnetic stripe, the same information is relayed every time, making it easier for someone to copy and misuse.
• Sophisticated encryption: Chip cards have encryption technology built right into the microchip. When a transaction happens, the chip creates a unique transaction code that cannot be used again and sends it to the issuer for verification.  
• Chip-and-signature vs. chip-and-PIN: Most chip cards distributed in the U.S. are chip-and-signature cards. They’re not as safe as chip-and-PIN cards because it’s easier to forge someone’s signature than to guess their PIN. Both are still safer than magnetic stripe cards.

Chip cards are safer than magnetic stripe cards, but the added security is only as good as the merchant’s ability to process chip card transactions. If a store does not have a point-of-sale device that’s chip-enabled, meaning there’s no slot for you to dip your credit card, then your transaction will be processed using the magnetic stripe on the back of the card. Your transaction will be less safe as a result.

Yes, Chip credit cards can be “hacked,” in the sense that a thief who inserts a “skimming” device into a credit card terminal can copy data from your credit card and later make a copy of the card. However, skimmers can only copy data from your card’s magnetic stripe, not its chip, which is much more encrypted. Therefore, any copy of your card will only have a magnetic stripe. That means criminals can’t use it any merchant that has a chip reader.

EMV chip cards enabled with contactless technology could also be at risk of NFC skimming. A contactless card uses NFC (Near Field Communication), a secure wireless technology that allows data to transfer from a mobile device to a card reader at a short distance. Someone close enough to you could use a scanning device to intercept the NFC signal and steal the card’s information.

In general, chip cards are safer than cards that only have a magnetic stripe. When you insert, or “dip,” a chip card rather than swiping it, the card’s built-in microchip and other security measures make it far more difficult for fraudsters to copy the card’s sensitive information.

Yet despite the security that chips provide, all chip cards still come with magnetic stripes. They’re necessary because not all merchants have payment terminals that can process chips. If a merchant does not have a chip card reader, you’ll have to swipe the card. This deprives you of the extra security protections built into the chip and leads to a greater risk of fraud.

It’s also important to note that cards with chip-and-PIN technology are more secure than chip-and-signature credit cards, yet most U.S. chip cards still come with the latter. They require a signature for purchases instead of a four-digit PIN. So if someone steals your card, they can forge your signature and make purchases.

If your chip credit card is hacked, skimmed or stolen, all major issuers have a $0 fraud liability guarantee on all of their credit cards. That means you won’t have to pay for the fraudulent transactions.

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 a “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.

What you should know about credit card technology:

Magnetic strip cards are inherently vulnerable to fraud. Their flaws have led to the transition to chip-enabled, or EMV (Euro, Mastercard, Visa) cards . These cards 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.

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.

Yes, contactless credit cards are secure because they use the same security standards for transactions as EMV chip credit cards. Whether you’re using a contactless credit card and tapping to pay or inserting your EMV chip card into a card reader, the sensitive information sent to the card reader is encrypted.  

Both contactless and EMV chip credit cards create a unique, one-time-use code for the transaction instead of sending your name, billing address, CVV code, or zip code. This is called “tokenization.” So, even if a thief intercepted your contactless transaction, they couldn’t do much with the information.

Top 4 Safety Concerns About Contactless Credit Cards (and Why You Shouldn’t Worry)

1. Can someone intercept my card info from a distance?
   No, it is not possible for someone to read your card from a distance as the technology behind contactless credit cards is based on a short-range RF (radio frequency) antenna that only transmits digital data within a very small range. In other words, it requires the card to be within a very short proximity (1-2 inches) of the payment terminal.
2. Is short-range skimming a possibility?
   Although Mastercard acknowledges the existence of phone apps that can pick up some of the data from contactless cards, the thief would have to be in extremely close proximity to the card, and the app could only read the account number and the card’s expiration date.
    
   A typical card transaction requires the account number, the expiration date, the security code on the back of the card (CVV) and/or the ZIP code from the billing address. So, even though it’s possible for fraudsters to collect some data from your credit card, the information they would be able to capture is not enough to complete a purchase.
3. Can contactless credit cards be duplicated?
   The contactless and EMV chip technology makes it harder for fraudsters to duplicate your card. When you make a credit card payment, it provides the reader with a unique, one-time code that identifies the transaction. This number is dynamic and cannot be copied.
    
   However, contactless credit cards still have a magnetic stripe, so the info from the magnetic stripe can be cloned and used by others. But the stolen information would only work for swiped purchases.
    
   Keep in mind that even in cases like this, an issuer’s fraud liability guarantee protects you from having to pay for unauthorized transactions made with your card.
4. Can someone use my lost/stolen credit card for purchases?
   Although contactless credit cards are secure in terms of technology, there is a downside for lost and stolen contactless cards. Usually, when making a contactless payment, no PIN or signature is required for small purchases.
    
   So, if your card is lost or stolen, it could be used by someone else without easy detection. In this case, make sure to contact your credit card issuer right away. You don’t need to worry too much about it, though, as you will not be held responsible for fraudulent and unauthorized charges.

Ultimately, it is worth noting that both EMV chip cards and contactless credit cards are more secure than swiping your card’s magnetic stripe.