# why are chips better than stripes?
**URL:** https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240
**Category:** Factual Questions
**Created:** [October 25, 2010, 2:45am UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240 "2010-10-25T02:45:06Z")
**Posts on this page:** 20
**Page:** 1
### Author:  [@Northern\_Piper](https://boards.straightdope.com/u/Northern_Piper)
#### Post date: [October 25, 2010, 2:45am UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/1 "2010-10-25T02:45:06Z")
On credit/debit cards, I mean. Why are the chips more secure? both stripes and chips need pins (at least for the debit card function). So what’s the benefit of chips’n’dips?
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### Author:  [@Larry\_Mudd](https://boards.straightdope.com/u/Larry_Mudd)
#### Post date: [October 25, 2010, 2:51am UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/2 "2010-10-25T02:51:57Z")
The main benefit is that your account number is passed to the device in an encrypted format - it’s harder to extract (and duplicate.)
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### Author:  [@Dewey\_Finn](https://boards.straightdope.com/u/Dewey_Finn)
#### Post date: [October 25, 2010, 3:07am UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/3 "2010-10-25T03:07:03Z")
[Here](http://www.nytimes.com/2010/10/17/business/17digi.html)’s an article from the New York Times suggesting that the chip-and-pin cards _aren’t_ superior to magnetic-stripe cards, because the network provides the necessary security to magnetic-stripe cards, and can be upgraded more easily.
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### Author:  [@firstname](https://boards.straightdope.com/u/firstname)
#### Post date: [October 25, 2010, 4:24am UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/4 "2010-10-25T04:24:07Z")
Probably not much, but its newer and therefore people haven’t learned to exploit it yet.
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### Author:  [@AmunRa](https://boards.straightdope.com/u/AmunRa)
#### Post date: [October 25, 2010, 5:57am UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/5 "2010-10-25T05:57:21Z")
> [@firstname](#):
>
> Probably not much, but its newer and therefore people haven’t learned to exploit it yet.
[Are](http://www.wired.com/wired/archive/14.05/rfid.html) [you](http://www.engadget.com/2008/03/19/rfid-credit-cards-easily-hacked-with-8-reader/) [sure](http://www.kensavage.com/archives/rfid-hacking/) [about](http://www.techwarelabs.com/rfid-hacking-is-it-a-threat/) [that](http://www.darkreading.com/security/encryption/showArticle.jhtml?articleID=208804456)?
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### Author:  [@Mogle](https://boards.straightdope.com/u/Mogle)
#### Post date: [October 25, 2010, 4:17pm UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/6 "2010-10-25T16:17:13Z")
> [@AmunRa](#):
>
> [Are](http://www.wired.com/wired/archive/14.05/rfid.html) [you](http://www.engadget.com/2008/03/19/rfid-credit-cards-easily-hacked-with-8-reader/) [sure](http://www.kensavage.com/archives/rfid-hacking/) [about](http://www.techwarelabs.com/rfid-hacking-is-it-a-threat/) [that](http://www.darkreading.com/security/encryption/showArticle.jhtml?articleID=208804456)?
There are credit/debit cards that use rfid chips? 😕
All the cards I’ve seen need to be properly inserted into a card reader to work, and this is one of the reasons chips are more secure than the magnetic strips. With the magnetic strip a scammer can place a card reader on top of any legitimate equipment without interfering with the normal operation and copy any card that’s used, with the chip only one piece of equipment can read the card at the same time and in order to make a copy the scammer would have to completely replace the legitimate equipment.
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### Author:  [@Markxxx](https://boards.straightdope.com/u/Markxxx)
#### Post date: [October 25, 2010, 4:43pm UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/7 "2010-10-25T16:43:25Z")
The Chicago Transit uses RFiD chips and they are awful
The passes they sell with magnetic strips, I have never had issue with. I’ve even accidently put it through the laundry and it worked. (Of course a scratch will kill it)
But these RFiD chips don’t even last me six months, without having to pay another $5.00 to get a new card.
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### Author:  [@kushiel](https://boards.straightdope.com/u/kushiel)
#### Post date: [October 25, 2010, 4:53pm UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/8 "2010-10-25T16:53:27Z")
> [@Mogle](#):
>
> There are credit/debit cards that use rfid chips? 😕
> All the cards I’ve seen need to be properly inserted into a card reader to work, and this is one of the reasons chips are more secure than the magnetic strips. With the magnetic strip a scammer can place a card reader on top of any legitimate equipment without interfering with the normal operation and copy any card that’s used, with the chip only one piece of equipment can read the card at the same time and in order to make a copy the scammer would have to completely replace the legitimate equipment.
Up here in Canadia, the same devices are used for both stripes and chips. You have the normal stripe swipe for old cards which is on the side, and on the bottom you are supposed to insert chip cards so it’s a different process on the same machine. The thing is, most places are still just just using the swipe method for chip cards.
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### Author:  [@RaftPeople](https://boards.straightdope.com/u/RaftPeople)
#### Post date: [October 25, 2010, 5:01pm UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/9 "2010-10-25T17:01:36Z")
> [@Mogle](#):
>
> There are credit/debit cards that use rfid chips? 😕
> All the cards I’ve seen need to be properly inserted into a card reader to work, and this is one of the reasons chips are more secure than the magnetic strips. With the magnetic strip a scammer can place a card reader on top of any legitimate equipment without interfering with the normal operation and copy any card that’s used, with the chip only one piece of equipment can read the card at the same time and in order to make a copy the scammer would have to completely replace the legitimate equipment.
In Europe, thousands of readers where modified during manufacturing to transmit the data to an external source. They had to check every scanner.
Also there were a chain of gas stations with compromised readers, don’t remember what that method was.
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### Author:  [@Mogle](https://boards.straightdope.com/u/Mogle)
#### Post date: [October 25, 2010, 5:17pm UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/10 "2010-10-25T17:17:22Z")
> [@RaftPeople](#):
>
> In Europe, thousands of readers where modified during manufacturing to transmit the data to an external source. They had to check every scanner.
This is a security issue with manufacturer, and it’s a Bad Thing regardless of the technology involved.
Also, cite please.
> [@](#):
>
> Also there were a chain of gas stations with compromised readers, don’t remember what that method was.
Since the gas stations(at least around here, and there has been skimming attacks here) still use the magnetic strips the answer is obvious.
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### Author:  [@Machine\_Elf](https://boards.straightdope.com/u/Machine_Elf)
#### Post date: [October 25, 2010, 5:54pm UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/11 "2010-10-25T17:54:41Z")
> [@Larry\_Mudd](#):
>
> The main benefit is that your account number is passed to the device in an encrypted format - it’s harder to extract (and duplicate.)
😕 Isn’t it also possible to encrypt the account number on a mag stripe?
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### Author:  [@Rayne\_Man](https://boards.straightdope.com/u/Rayne_Man)
#### Post date: [October 25, 2010, 6:14pm UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/12 "2010-10-25T18:14:58Z")
> [@RaftPeople](#):
>
> Also there were a chain of gas stations with compromised readers, don’t remember what that method was.
As well as actually compromising the reader, a miniature TV camera was hidden in the ceiling to capture the customer keying in their PIN code.
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### Author:  [@Rysto](https://boards.straightdope.com/u/Rysto)
#### Post date: [October 25, 2010, 8:45pm UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/13 "2010-10-25T20:45:42Z")
> [@Machine\_Elf](#):
>
> 😕 Isn’t it also possible to encrypt the account number on a mag stripe?
Sure, but it doesn’t buy you much. Even if the number is encrypted the crooks just need to copy the encrypted account number and put it on a new magnetic stripe card. They don’t need to be able to decode it.
To be secure the card needs to authenticate the server and do end-to-end encryption. You need a real microchip to do that.
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### Author:  [@RaftPeople](https://boards.straightdope.com/u/RaftPeople)
#### Post date: [October 26, 2010, 1:23am UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/14 "2010-10-26T01:23:23Z")
> [@Mogle](#):
>
> This is a security issue with manufacturer, and it’s a Bad Thing regardless of the technology involved.
> Also, cite please.
Yes it’s a bad thing regardless of the technology involved. It was just an interesting relevant story that illustrates how difficult it is to be truly secure.
> **[Chip and pin scam 'has netted millions from British shoppers'](https://www.telegraph.co.uk/news/uknews/law-and-order/3173346/Chip-and-pin-scam-has-netted-millions-from-British-shoppers.html)**
>
> A sophisticated "chip and pin" scam run by criminal gangs in China and Pakistan is netting millions of pounds from the bank accounts of British shoppers, America's top cyber security official has revealed.
> [@](#):
>
> Since the gas stations(at least around here, and there has been skimming attacks here) still use the magnetic strips the answer is obvious.
Shell Chip and Pin
> **[BBC NEWS | UK | England | Petrol firm suspends chip-and-pin](http://news.bbc.co.uk/2/hi/uk_news/england/4980190.stm)**
>
> Shell suspends chip-and-pin payments at 600 UK petrol stations after eight arrests in a fraud inquiry.
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### Author:  [@Rayne\_Man](https://boards.straightdope.com/u/Rayne_Man)
#### Post date: [October 26, 2010, 6:35am UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/15 "2010-10-26T06:35:20Z")
> [@RaftPeople](#):
>
> Shell Chip and Pin
> [BBC NEWS | UK | England | Petrol firm suspends chip-and-pin](http://news.bbc.co.uk/2/hi/uk_news/england/4980190.stm)
That was a story from four years ago.
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### Author:  [@kombatminipig](https://boards.straightdope.com/u/kombatminipig)
#### Post date: [October 26, 2010, 10:35am UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/16 "2010-10-26T10:35:32Z")
Basically, the difference is this:
A magnetic strip is simply a number in a coded format. A reader reads the number and copies it down, and that’s pretty much it. If your card gets skimmed by a waiter or a modified ATM, they essentially have a copy of your credit card.
By comparison, chip (smart card) contains some intelligence, which means that the number read by the reader is a combination of the (encoded) card number, possibly your pin code and some secret values embedded in the card. In other words, the identity of the card can’t be replicated by simply scanning the value in the reader.
Smart cards aren’t perfect and are vulnerable to hardware analysis, but the cost/gain equation is such that performing a deep analysis of a smart card usually isn’t worth it.
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### Author:  [@GiantRat](https://boards.straightdope.com/u/GiantRat)
#### Post date: [October 26, 2010, 12:44pm UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/17 "2010-10-26T12:44:17Z")
[Payment Card Industry Qualified Security Assessor here]
Encryption of the PAN (Primary Account Number) is only part of the game. If there’s a skimmer on the point of sale (POS) unit, you’re hosed regardless of whether it’s chip or mag stripe. With chip’n’PIN, it’s a little more secure… but if I were going to install a skimmer, I’d also install a mechanism to capture the PIN. It takes about 3 minutes at most.
The card brands and merchants are trying to provide a level of security that doesn’t interfere with their profitability (strong security is expensive). They’re going through the motions of doing the right thing and are, in fact, raising the security level of their product. It ain’t perfect.
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### Author:  [@Mogle](https://boards.straightdope.com/u/Mogle)
#### Post date: [October 26, 2010, 3:53pm UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/18 "2010-10-26T15:53:51Z")
> [@GiantRat](#):
>
> Encryption of the PAN (Primary Account Number) is only part of the game. If there’s a skimmer on the point of sale (POS) unit, you’re hosed regardless of whether it’s chip or mag stripe. With chip’n’PIN, it’s a little more secure… but if I were going to install a skimmer, I’d also install a mechanism to capture the PIN. It takes about 3 minutes at most.
Are you saying that there are chip readers that can get all the relevant information by just having the chip pass by it(ie the device was stuck on top of the card slot)?
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### Author:  [@Squink](https://boards.straightdope.com/u/Squink)
#### Post date: [October 26, 2010, 4:59pm UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/19 "2010-10-26T16:59:15Z")
Fish and **stripes**?
Nah, that’ll never catch on ! 😃
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### Author:  [@GiantRat](https://boards.straightdope.com/u/GiantRat)
#### Post date: [October 27, 2010, 11:19am UTC](https://boards.straightdope.com/t/why-are-chips-better-than-stripes/558240/20 "2010-10-27T11:19:34Z")
> [@Mogle](#):
>
> Are you saying that there are chip readers that can get all the relevant information by just having the chip pass by it(ie the device was stuck on top of the card slot)?
The card would have to be used by the authorized person (or at least someone with the PIN). Once that transaction is completed, and EvilRat has captured the PIN… your ass is mine, as it were.
This can all be done with toys like WireShark, EtterCap, or whatever. It’s neither rocket surgery nor brain science.
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