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Beyond the Transaction: Every Transaction Has a Story

Six Things to Know About Chip Cards (EMV)

Carolyn Balfany, SVP Product Development at MasterCard, addresses EMV. She explains: a) what it is and b) how it will benefit the entire payments ecosystem.


The days of credit and debit cards with black magnetic stripes across the back are not the future. The U.S. is moving toward EMV and chip cards. The media has been abuzz recently with references to this important change. So what do you need to know?

Q.  The Basics – What are Chip Cards?

EMV chip cards have computer chips embedded in them. They are widely used in Europe and Asia and are beginning to be adopted in the U.S.

People who frequently travel abroad may already have chip cards or may have seen them used in London, Toronto and Istanbul. The rest of us are likely to have chip cards in our hands by 2015.

Q.  Why Chip Cards?

Chip cards better protect your account information from fraud. And every electronic payment – credit cards, debit cards, digital wallets – is almost always more secure than cash.EMV credit card

The magnetic-striped credit and debit cards you are accustomed to contain “static” data, or payment data that does not change. The data stored in the magnetic stripes includes your 16-digit card account number, expiration date and 3-digit security code (CVC) like the one found on the back of your card.

Chip cards contain the same data and more. Each purchase or transaction that you make generates “dynamic” or unique data that is encoded in a safe mode.

EMV helps protect you even if your card or your card data is lost or stolen, the technology:

  • Makes it difficult for anyone but the rightful owner to use the card
  • Protects against the creation of counterfeit cards because dynamic data is only good for a single purchase or use

Q. What is MasterCard Doing?

MasterCard is one of the original founders of the chip card standard known as EMV, short for EuroPay (now part of MasterCard), MasterCard and Visa.

We continue to advance the technology and introduce it to every country around the world . . . allowing you to safely use your MasterCard no matter where you are.

Q.  Will this Change The Way I Pay for Things?

A little bit. Rather than swiping your card, you may soon insert it into or tap it against a card reader so the chip on your card and the reader can “talk” and establish a secure connection.

Q.  Why Isn’t the U.S. Currently Using Chip Card Technology?

Historically, countries with higher fraud rates switched to chip cards earlier than countries with lower fraud rates.

Q. What will I see as a Cardholder?

First, you will see new card readers or payment terminals in your favorite stores and restaurants. Many of the new readers are already in place, especially if the business caters to travelers from outside the U.S.

Next your bank or credit union will send you a new chip card. Some EMV cards are already available in the U.S. However, the chip cards are provided predominantly on an “at request” basis and, as mentioned, most often to international travelers.