A new year brings along a new way to pay for things. And no, we're not talking about Apple Pay. At the end of 2015, most retailers accept cards to EMV chip, more commonly known as the chip name and PIN cards. Common in Europe and much of the rest of the world for nearly 20 years, the United States will finally adopt the system safer to make purchases with a credit card. Chip and PIN cards have been credited to cut both the credit card fraud and debit in Europe more than 65 percent over the last decade, as reported by the New York Times.
Many big banks already issue credit cards with EMV technology, including American Express, Capital One, Chase and Barclaycard. And since credit card fraud has increased dramatically over the years in the United States, all banks and merchants are finally addressing the problem head on. all bank POS systems will not only be updated to accept chip cards cards, but the responsibility for fraud will also be without banks to retailers beginning in October if a trader has failed to update their equipment payment to accept EMV cards.
How does EMV?
Now when you make a purchase with a credit card, a magnetic stripe is swiped and you sign a piece of paper indicating that you have authorized the purchase. With EMV, there are two different, but very similar forms to make a purchase. Instead of dragging a magnetic tape, a chip embedded in the card is read and creates a single transaction code which is then approved by the client. This can be done in two ways.
with a chip and PIN credit card, you enter a personal four-digit code, as you would with a debit card now, to approve the purchase. Chip cards and signature cards work the same way: the chip credit card is read and sign your name on the receipt to approve the purchase, as you do now. Steal information from a chip and PIN or chip and signature purchase is much more difficult than stealing from a purchase of magnetic tape. Indeed, tapes stores all data of the individual, while the EMV chip is designed to encrypt each individual purchase.
Depending on your bank, or you will be issued a chip and PIN or smart credit card and signature in 2015 if you have not already received the replacement for your current magnetic stripe card. Many US banks currently offer the chip and signature cards, which work very well at home, and most places abroad. Some foreign travelers might prefer a smart card and PIN for purchases in automated ticket kiosks in Europe, however, as many unmanned machines need a PIN to approve a purchase.
What is the best available EMV credit card?
If you want to get a jumpstart on the new credit card technology and your bank has not yet sent an EMV card to replace your tape, consider getting Capital One Venture Rewards credit card. It comes with a bonus of 40,000 miles introduction in circulation, which is good for $ 400 in travel, when you spend $ 3,000 in the first three months of opening your account. You will earn two miles for every dollar spent without spending limit, and there is no foreign transaction fees so you will not be charged anything extra when buying outside the US To top the whole, the annual fee of $ 59 is waived the first year.
Read our guide on EMV technology if you want to learn more, or read on our credit card reviews to see the best cards available now.