Are Chip Debit Cards Safer? Not All Debit Cards Are Created Equal
December 14, 2017
By Michael Brauer
Digital Marketing Specialist
You might be wondering why stores and payment terminals across the country are now encouraging you to insert your debit card instead of swiping it.
“Let me assure you, inserting the chip is worth it for your security,” explains Chris Jackson, Assistant Vice President of Retail Services at Security National Bank.
The small, metallic square on Security National Bank's new chip-enabled Debit Card — known in the industry as EMV card technology — is what sets it apart from previous generations of magnetic stripe debit cards.
Why is the chip card more secure?
The main advantage of chip-based debit cards is that the technology used in the card is more advanced and more secure.
“The magnetic strips on older cards contain unchanging data, making them prime targets for hackers and counterfeiters who can replicate that data and use it to make several purchases or cash advances before the card can be shut down,” Jackson says. The new EMV chip debit card, on the other hand, creates a unique transaction code that cannot be duplicated.
What is an EMV chip?
EMV stands for Europay, Mastercard and VISA, the three companies who originally created what is now a global industry standard. An EMV chip is a small computer chip that provides additional protection from fraud.
Why EMV cards are more secure
Because of the way an EMV chip stores, encrypts and transmits your financial data, it is virtually impossible for identity thieves to create counterfeit chip debit cards.
“The chip prevents someone from stealing card information from a single point of sale or from the card skimming scams that are running rampant right now,” Jackson says.
While EMV technology won’t prevent data breaches completely, it does make it harder for hackers and criminals to benefit from what they steal. In fact, as of March 2017, merchants using chip cards saw a 58 percent drop in counterfeit fraud from the previous year.
Are chip debit cards safer for online transactions?
Safer in-person transactions are a big advantage of chip based debit cards. However, Jackson cautions that consumers still need to be careful about what they purchase online and what websites they buy things from. He recommends consumers monitor their accounts frequently via online/mobile banking. After all, most online fraud occurs regardless of which type of credit or debit card is used.
International travel advantages of chip based debit cards
“Upgrading to the chip cards increases consumer security while giving them a payment method that is accepted around the world — even more widely than the mag stripe,” Jackson says.
EMV cards have actually been the standard in other countries for many years, and the United States has been a little bit late to the party, only starting to transition to EMV technology in 2011. Many payment terminals abroad will no longer accept payments from magnetic stripe debit cards, so switching to a chip debit card will make it easier to travel.
The future of payment technology
“As big of a change as the smart chip is, it’s only the beginning,” Jackson says. “Payment technology continues to get more and more secure as card companies and merchants try to stay ahead of criminals.”
Security National Bank has always been committed to protecting its customers from fraudulent activity.
“We don't see a lot of fraud,” Jackson adds. “This is in large part due to our team of specialists in place who provide education on fraud prevention, and we have a fraud detection service that monitors for unusual activity.”
SNB customers can now expect to see chip technology on their debit cards as they are replaced over the next two years.
Still wondering why chip debit cards are safer?
Refer to our Chip Debit Card FAQ page to find an answer, or contact Security National Bank today.