EMV Chip Card Benefits for Consumers

What Does the EMV Change Mean to Consumers?

With the October 1, 2015, liability switch and the mass conversion to EMV-capable card readers, consumers will need to learn some new ways to use their debit and credit cards in stores. Much stays the same, especially during the EMV transition as “swiping” and signing are still used, but consumers can now also “dip” or “tap” their cards to complete a payment.

The enhanced security that the Chip-and-PIN or Chip-and-Signature cards bring will also benefit consumers. The hassle of having credit card data stolen should be experienced by fewer card users each year, as will the costs they share from card theft and fraud overall.

"Dipping" and "Tapping" Cards for Payment

EMV-enabled cards, either the Chip-and-PIN or Chip-and-Signature, carry account data in an embedded electronic chip, instead of in the magnetic stripe. This recorded information is passed to an EMV-capable card reader during payment, and a transaction-specific encryption is created; enhancing the security of the card and transaction.

Using the Chip-and-PIN or Chip-and-Signature card with the card reader requires "dipping" the card into a slot and waiting for the payment to process fully. If the card is pulled from the slot too quickly it can nullify the transaction. More consumer patience may be required with dipping than for the old-style swiping.

Many of the new EMV cards also include near field communication (NFC) technology and can be "tapped" on the reader for payment on specific machines. This is the same technology used when tapping a smartphone or smartwatch to pay.

Swiping, Signing, and Entering PINs Remain

To stay "backward compatible", EMV-enabled cards also come with the familiar magnetic data strip on the back. Swiping might still be required if the chip reading technology fails to function as intended. Many mobile payment devices continue to require swiping and will until merchants who rely on them also make the switch or the companies offering the payment devices make EMV-capable mobile card readers.

EMV card users might be asked to sign for electronic purchases in-store, or enter a personal identification number (PIN), depending on the system. Chip-and-PIN cards work pretty much like checking account debit cards consumers are already using.

Even though EMV technology is the upcoming way to accept payments, the adoption of EMV-capable card readers has been slow for merchants. Nearly 70% of consumers have had chipped card as of March 2016, which is greatly outpacing the portion of EMV-ready merchants, so swiping, signing, and entering PINs aren't going anywhere soon.

Added EMV Security Should Benefit the Consumer

The enormous cost associated with credit card loss and fraud, estimated at $10 billion in the United States for 2015, certainly warrants conversion to EMV across the country. Unaccounted for is the huge cost consumers pay when their credit card information is stolen: the feeling of being violated, the time and effort spent addressing the fraud, and the loss of a sense of financial security.

The EMV changeover should reduce these effects on consumers. Fewer will be victimized by credit card thieves each year, boosting consumer confidence that electronic payment cards are safe to carry around (and use), and adding to their peace of mind.

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