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EMV and You: Questions About the New Technology

May 11, 2017

In 2016, Bank of the Sierra completed its transition to payment cards with EMV chip technology. At this point in the nation-wide conversion efforts, it’s becoming less and less likely that you have a card that doesn’t carry the chip technology. While the effect on customers’ daily lives is minimal, this transition, is new to many, and as such, you the consumer may have questions about it. Here are some common questions we’re seeing related to the new technology.

1.What does EMV stand for?

It stands for Europay, Mastercard, Visa—the names of the card companies that first developed the technology (now a wide range of companies—not just these three—are using the same technology).

2.So why the chip?

The chip you see embedded on the front of your card is actually a microprocessor that stores and transmits information about individual transactions, making it very difficult to counterfeit your card, or use it if it’s lost or stolen.

3.Is it really safer?

With the added complexity of the chip, combined with the identity verification procedures that vendors use (PIN or signature), the new technology greatly reduces fraud. After the UK adopted the technology, overall credit card fraud was reduced by 32.5%, fraud from a lost or stolen card was reduced by 56.3%, and counterfeit card fraud fell by a whopping 72.5%!

4.Why do some vendors accept it while others don’t?

There may be a few reasons for a vendor to delay on making the switch, but cost is certainly a big factor (It’s especially costly for gas pump upgrades). As such, you may see the big chain stores adopt the technology first while the mom & pop stores wait however, vendors must be aware that in the event of fraud, liability has switched to the party that is least EMV compliant. This means of October, 2015, liability in the event of fraud has switched over to whoever is least EMV-compliant. This means that if you use your EMV card at the grocery store who still uses the old magnetic stripe method, and you become victim of fraud, the grocery store is liable, not the bank. Gas pump vendors were given a pushed-back deadline of 2017 to assume full responsibility of fraud if not fully EMV compliant. As you see, the U.S. is still in the change-over process while vendors get accustomed to the new technology.

5. I’ve heard transactions take longer—why is this, and how bad is it?

Due to the more complex transaction information being sent back and forth, you will notice a lag time in transactions, compared to the older swipe transactions. This is generally just a few seconds, though, and shouldn’t set your schedule back too much at all. You can use it as an opportunity to get to know your cashier at the grocery store better.

6.Is the card fraud-proof?

As with most things, and especially card security, nothing is 100%. Though the technology takes great strides in increasing the security of your payments, there is constantly a greater effort by criminals to improve fraud methods and technology. As always, it’s good to follow identity theft and card safety practices so that you can save yourself from becoming a victim.

7.Are there any other benefits?

Many other countries switched over to EMV technology years ago. As such, your chip card brings you up to the international standard for transactions. This means you’re less likely to encounter problems when trying to pay for something on vacation abroad.

As you see, the technology is new, but over the next few years, it will become the standard for card transactions. As you continue to notice more and more vendors in your area adopt the technology, give them a nod, or a thanks, for taking steps to make electronic transfers more secure.

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