What is an EMV chip and how does it work?

In addition to the magnetic stripe, many debit and credit cards carry an embedded microchip for added security. This is known as an EMV chip.

But how exactly do EMV chip cards work? Here’s what cardholders should know about this technology and why it matters.

Key takeaways

  • EMV chips are used to help protect debit and credit cardholders against fraud.
  • For added security, EMV chip cardholders may be prompted to input a four-digit personal identification number (PIN) or signature when making a transaction.
  • It’s more difficult for fraudsters to duplicate EMV chip cards than magnetic stripe cards.

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What is an EMV chip?

EMV chip technology was developed in the mid-1990s and named after its joint developers, Europay, Mastercard and Visa. Today, this technology has been adapted into billions of cards and millions of point-of-sale (POS) systems worldwide.

EMV was created as a way to safeguard cardholders’ information during debit and credit card transactions. Debit and credit cards that use EMV technology feature an embedded microchip that is visible on the front of the card.

A person’s hand holding a blue card with a chip on it.

How does EMV technology work?

To help protect consumers against fraud, a unique code is created for every transaction made with an EMV chip card. Because the technology is more difficult to replicate, it’s harder for counterfeiters to steal information from EMV cards.

To use an EMV chip card for payment, customers can insert, or dip, the chip side of their card on the POS terminal rather than swiping it. They might be prompted to enter their PIN or provide a signature before the vendor can authenticate and authorize the transaction.

EMV vs. magnetic stripe card technology

The key difference between magnetic stripe and EMV chip cards is the technology. Magnetic stripe cards store static—or unchanging—personal data about the cardholder within the card. EMV chip cards, on the other hand, are constantly changing and create a unique code when transmitting data for each transaction. Because of this, magnetic stripe cards tend to be easier for fraudsters to copy than EMV chip cards.

What to do if a merchant doesn’t accept EMV chip cards

Although EMV chip cards are more widely accepted, there are still many merchants that haven’t yet adopted this technology. When shopping at one of these merchants, a person will need to swipe their card using the magnetic stripe. 

And for online payments, shoppers can enter their card information in the payment details as they would with any other debit or credit card.

EMV chip FAQ

Here are some frequently asked questions about EMV chip technology:

Yes, all chip cards use embedded EMV technology. 

Unlike EMV, which requires a physical connection, RFID—or radio-frequency identification—uses radio waves to complete the payment. They’re different technologies. But some EMV transactions use RFID technology, such as contactless payments like mobile or tap to pay.

While EMV chip cards can help cut down on credit and debit card fraud, it’s still important to take precautions to minimize the risk of credit card fraud. This includes doing things like:

  • Not giving out your card information to other people
  • Using multifactor authentication, like entering a PIN or password
  • Keeping a close eye on account activity
  • Securing your cards, PIN numbers and receipts with sensitive information
  • Properly disposing of old cards

And Capital One customers have added security features.

EMV chips in a nutshell

EMV chip technology can help reduce the risk of credit and debit card fraud. That’s because EMV chips are more secure than magnetic stripe cards. They’re also harder to counterfeit and require stricter authentication for each transaction.

Learn how debit and credit card fraud protection works, and what you can do to better secure your financial information.

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