EMV Cards are Here, but are not Quite the Same as in Europe

Over the last seven years, the amount of fraud from stolen credit card data has doubled in the U.S. This has been the primary driver pushing American credit card companies and retailers into adopting the use of credit cards with computer chips in them. The problem with the old magnetic stripe credit cards we are so familiar with is that the data on the magnetic stripe is static – it never changes. Because of this, fraudsters have been able to simply copy the magnetic stripe data from your card to a blank one, and then use the new card to make purchases. The computer chips in Europay, MasterCard and Visa (EMV) cards, on the other hand, set up a one-time transaction code that is useless to intercept or copy. If a thief attempts to make another transaction using this information, the transaction will simply be denied.
These kinds of credit and debit cards have been used in Europe for decades, and have greatly reduced the amount of credit card fraud there. But the American versions of these cards are going to be different for some years to come. For one thing, EMV cards issued to Americans are still going to have the magnetic stripe on them until at least 2017. This is to give retailers a chance to install the necessary (and expensive) equipment needed to process EMV cards. Also, even though most retailers are supposed to have EMV card reader hardware in place as of October this year, gasoline retailers are not required to change their pump card readers until 2017.
Another difference is the use of a PIN with the cards. In Europe, they have found that requiring a 4 to 6 digit PIN number when cards are used greatly adds to the security of the transaction (just like inputting a PIN when you use your debit card here does). But most companies in America are just going to require a signature, and are not going to allow the use of PINs with these cards for a while. This is not only to spread out the cost of re-equipping for the merchant, but is also to allow American consumers to get used to the new cards. Eventually, America will probably be using the same setup they currently use in Europe, but until then, remember that your cards will still suffer from some of the same old vulnerabilities as always.

1 thought on “EMV Cards are Here, but are not Quite the Same as in Europe

Leave a Reply