Why Chips are used In Cards (2)

How Does EMV Chip Cards Works? FAQ about Chip Cards

All the Credit Card holder is familiar with “Swipe and Sign” payment procedure. Basically, Users just need to swipe the card, press “OK” for the amount to be charged, and then sign your illegible scrawl on the screen. When we look at the International markets, they prefer “EMV Cards” or Chip Cards for safe payments.

What is EMV or Chip Card – 

With Chip Cards, all the credit card details are stored in a tiny computer chip and when users use it they need to enter a four-digit Pin for verifying Identity.

How does EMV Card Technology Work – 


Each time when Users insert their cards on a reader it will generate a random encrypted code that is good for that specific transaction. The payment terminal Check the encrypted code and identify how the encryptions were implemented. After checking the code, the terminal can use the decryption key and authorise the payments.

So, each code is for one-time use only it’s totally useless to the attackers.

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Benefit of Chip Cards – 

One of the benefits of chip and PIN technology is that the card reader does not have to be connected to a phone or Internet line to process the charge.

Because of can work offline, processing the charge using the chip alone and then authorizing the charges in bulk at the end of the day.

The biggest benefit of chip cards is that it is more secure than magnetic stripe cards because they require a four-digit PIN for authorization.

Problem with Chip Cards

It’s the easiest way to pay when it works but there are several ways that it might not.

Users cards are often incompatible with the chip and PIN implementation in other countries.

There are lots of places where they don’t accept Chip Cards.

There are now many stores that have credit card readers that not compatible with Chip Cards.

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Chip Cards FAQ – 


(From: VIsa)

What about when I shop online with a chip card?

The chip in the card offers no improvement in security when you’re using your credit card number to shop online. It will be the same as if the card were a magnetic stripe card. If you happen to have a small portable chip card reader, then the enhanced security could come into play, assuming the seller on the other end could accept that kind of data. An artist selling paintings or a small merchant using chip-reading technology provided by Square or another vendor would still need to read an actual chip card in person, even though the transaction would almost seem to be online.

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Where can I use my chip card?

You can use your chip card anywhere cards are accepted. You can swipe your card just like you do today using the magnetic stripe on the back of the card, if a chip-activated terminal is not yet available. The terminal or the cashier will prompt you to insert and leave the card in the terminal until the transaction is complete if it’s activated for a chip.

Can I still use my card over the phone or online?

Absolutely. Your card will work over the phone and online just like it always has.

What if my chip card doesn’t work when I insert it into the chip terminal?

Some merchants may have chip terminals, but they may not yet be activated to accept chip cards. If you are unable to insert your chip card into a chip terminal, you can always swipe your card to complete the transaction. Most often, merchants that haven’t activated their terminals will block the chip slot.

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How will I know whether to swipe my card or insert it?

Your card will always work either by swipe or insertion. The terminal or the cashier will prompt you to insert the card into the terminal if it’s activated for chip technology. If the terminal is not yet chip-activated, you can always swipe your card to complete the purchase.


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