My bank finally got around to issuing chip credit cards. I’ve had a card with them for years and once several years ago someone lifted the number at gas station using some device and tried to buy cigars with it. Since I never buy cigars, the bank’s fraud department called me and we figured out what had happened and I got a new card. Fine. So I get my new chip card, activate it, and use it once. At a place I buy stuff from approximately once a month, never had a problem. Two days later, someone has charged a whole bunch of weird stuff against the card and the bank hasn’t noticed. I only noticed so quickly because it was time to pay the bill and the balance was alarmingly high. The bank has cancelled these transactions and issued me yet another new (chipped) card.
The cards are more secure because the reader doesn’t get access to the card information; instead, there’s a realtime handshake between the merchant and the card network that verifies the card is valid. At no point is any replicable information made available to the machine, simple card copiers won’t be able to store the information, and once you yank the card there’s no way for a 2nd transaction to happen, unlike current readers which could just resubmit the numbers.
The system as a whole is still very insecure, because chip readers are not yet mandatory. However, all of the card issuers have updated their contracts to force the weakest link in the chain to pay for the fraud. So, for instance, if Joe’s Bar down the street still has their swipe readers activated instead of the chip readers, and one of their servers is stealing card information, it’s on Joe. That’s his incentive to upgrade. Eventually they’ll be able to stop putting mag stripes on the back.
Internet purchases still need to be sorted out. As long as you can buy stuff by typing 23 digits into a website, the system will never be secure.
Any time you swipe your chip card, it’s just as insecure as a swipe card. It’s only chip & pin transactions that are secure. Chip cards also do nothing whatsoever to protect you from data breaches at retailers or that sort of thing. They make magnetic card skimmers obsolete, and that’s just about all.
The only way it would be more secure than normal cards is the fact that most eople can’t figure out how to use them, as witnessed last Sunday at the local WalMart.
Also, the cashier at WalMart has to walk around the aisle and come over and show me where the invisible slot is somewhere underneath the card reader, so that’s more hands-on, too. The card reader can still be used to swipe a card with no chip, but somehow it knows if a card has a chip, and then refuses to read the magnetic stripe, which is also still on the card, where it works at my supermarket where there is no chip reader. And that’s how technology has made everything better now.
At least, they haven’t borrowed the ATM ploy of making me guess whether my account is a checking or savings account, and I nearly always guess wrong and have to try it a second time. My bank thinks it is a checking account, and has told me so, and they just laugh when I tell them that the ATM doesn’t work unless I lie to it and say it is savings. But some don’t – it depends on the ATM.
I don’t mind the chip concept, but when I encounter a card reader with a slot for chipped cards, one of the following happens:
<inserts card into slot> “Oh, that doesn’t work. You have to swipe it.”
OR:
<swipes card> “Oh, that’s a chip card. You have to insert it.”
Considering that there are only two options, it’s astounding how often I manage to choose the wrong one.
Some complaints about the chip cards:
- on many readers, it seems really hard to find the slot to insert them. Much harder than finding the swipe channel, which is right there in view.
- there seem to be twice as many ways to insert the card wrong. On the swipe cards, many readers would work as long as you had the magnetic stripe in the swipe slot, whichever side was up. On the chip ones I’ve used, only 1 of the 4 possible options will work.
- it takes longer for the machine to read the card. This is the main problem I see. Possibly it took just as long on the swipe cards, but you could swipe them, put them ack in your wallet, and go back to bagging your purchases while the computers did their verifying, But with the chip cards, you have to leave it in the machine all that time.
And, frankly, I doubt that it’s going to help that much with security.
All the big problems I’ve read about involved poor security or corrupt insiders at a company stealing databases of credit card accounts; I don’t see how chip cards will prevent that. And the only frauds against my personal accounts have been done via onlne purchases, and since people con’t have insert devices n their home computers, I don’t see how the chip cards would have prevented this.
Ir seems to have been introduced too soon and too fast; Conservative America with her vast population to train in the new ways should step back from confusing technological changes and have other countries go through the teething pains for a couple of decades until the bugs are sorted out and the nation has been prepared for change.
Like, with the metric system and health care and headlight dimmer switches.
On the contrary, I still encounter terminals where the chip reader isn’t enabled yet. And nevermind the fact that we half-assed the implementation in the US as it is, using chip & sign instead of chip & pin. I guess we’re all a bunch of ignoramuses who can’t remember 4 numbers, even though I’d wager most of us who have a credit card also have a debit or ATM card.
That covers the electronic part of the transaction, but also…
-Don’t allow clerks to look at your card if possible. Slide/insert the card yourself. (Some people can remember the numbers. Or with multiple visits and them seeing your card, they can eventually get all the numbers.)
-And place black electrical tape over the numbers and expiration date. (People are taking pictures of other people’s cards while in line at the checkout. This also keeps clerks from seeing your numbers - they mostly only need to slide it in the machine - rarely do they need to enter any numbers off the card. If they do, I peel the tape off and tell them the last few numbers and/or security code.)
For the same reason, I’ve given up and actually started asking first if the chip reader is working. Which is annoying in its own way, but at least I don’t feel like I’m being scolded every time for having guessed incorrectly.
Many merchants in my area have actually made it so when you use the chip, you don’t need to enter a pin or sign. The machine automatically puts the transaction through with no input other than sticking the card in the chip slot
Maybe this is a whoosh, but other countries using it for decades is exactly what happened.
On Sat. I used my new chip card for the first time at Walmart. The person ahead of me used it no problem. I paid attention to the process.
My turn. Fumble around finding the slot. (Having a black background info card below the black machine doesn’t help folks!) Get it in. Nothing happens. Nothing at all. No light, beep, display change. Nothing. The clerk tries various things. Nothing happens at all.
A manager comes by. Reboots the machine. Has to enter a passcode, etc. Time passes. Children grow older, leaves change color, etc. Finally it takes my card.
Oh, the real kicker: the machines were installed the previous day. Glad to know they get all the bugs worked out before rolling them out.
A lot of credit card stuff is security theater. We’re just getting a new version of the show. Even the PIN stuff, if they ever get around to requiring it, isn’t all that it’s cracked up to be.
I still get my foot caught on the steering wheel trying to trigger the column mounted dimmer.
I always have to push mine a touch past the point where I first feel resistance to get it into the “slot” to read it. But I’ve only used it two or three times.
Both the clerk and manager tried inserting the card. Nada for everybody.
I used one today that you had to swipe first, so the machine could tell you to insert it. 
There are at least three stores I shop at regularly which don’t have the chip reader enabled but do let me pay with my phone. It looks like chips are being leapfrogged.