Financial institutions are now issuing chip-enabled credit and debit cards. You may have already received one without even knowing. Or you may not know why you received one or what to do with it. That’s okay – you are not alone. The Heartland Credit Union Association offers the following information to help you better understand chip-enabled technology.
What is a Chip Card?
A chip card is a credit or debit card containing an embedded chip that encrypts, protects and stores cardholder data. Chip technology is considered a more secure alternative to the magnetic stripe card, and it is the next evolution of electronic payments.
How Will I Know I Have a Chip Card?
Look for a metallic, thumbnail-sized square on the front of the card. That’s the chip. If it isn’t there, you don’t have a chip card.
What is the Benefit of Using a Chip Card?
Chip cards are harder to counterfeit than magnetic stripe cards. Rather than sending card information to a merchant when you buy something, chip cards send a unique code that cannot be reused. It’s like stealing an expired password.
How Do I Use a Chip Card?
Simply insert the chip card into the terminal with the chip facing up and follow the prompts on the screen. Then, remove the card from the terminal when prompted. It’s similar to what you already do today. However, some merchants may not be set up for chip transactions.
Can I Still Swipe a Chip Card to Pay?
The only reason to swipe your chip card is if the merchant is not yet chip-activated. When you swipe a chip card, you lose all the added security benefits of chip technology.
Does the Chip Prevent Credit Fraud?
Chip cards are a step forward in fraud prevention. However, they do NOT protect you completely from card fraud. A chip card does not prevent online and other types of card-not-present fraud. Using a chip card would not have protected you from the widespread merchant data breaches, such as Target and Home Depot. As a consumer you must stay vigilant, check your accounts often and report any unusual activity to your card issuer immediately.
How Do I Keep My Chip Card Secure?
The Heartland Credit Union Association offers the following information to help keep you and your account information safe and secure.
Here’s how it works. Scam artists send bogus emails posing as the chip card issuer, claiming they need updated account information or asking the recipient to click on a link to continue the process.
Doing either of those actions exposes you to risk, giving scammers access to private information – information they can use to steal your identity or install malware on your computer that gives access to passwords and financial information.
Remember there is NO reason for your card issuer to contact you by email (or by phone, for that matter) to confirm personal information before sending you a new chip card.
To identify a fake email, look for these tell-tale signs:
- A fishy email address: If it looks overly long or otherwise clearly not associated with your credit card issuer;
- A generic salutation: Does the email begin with “Dear Customer” and appear to know very little about you? Most legitimate emails include the last four digits of your credit card number; and
- A suspicious link to your account: Never click on a link in an email. It’s safer to just go to your account login manually using a bookmark or typing the URL.
If you have any questions about your card, call the financial institution or the 800-number on the back. While the new chip cards have more protections than a magnetic stripe card —they’re not perfect. Even if you’ve already received your chip card(s), it’s still important to check your account often and report any unusual activity to your card issuer.
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