After all of the point of sale (POS) system breaches last year like at Home Depot, Bebe, and Chick-fil-A, card issuers are beginning to send out new cards with EMV chip technology. EMV stands for EuroPay, MasterCard and Visa who are the three companies that developed the chip verification standard. This technology can be used in conjunction with your PIN, often called chip-and-PIN, but this may not always be the case. Depending on the verification method tied to the chip on your payment card, you may swipe the card; enter it into the POS for chip verification; and then provide your signature, often called chip-and-signature.
This technology has greatly reduced card-present fraud in Europe by preventing criminals from creating duplicate credit cards from stolen breach data. Every time a payment card is used for a transaction, the EMV chip creates a unique transaction code that cannot be used again. Therefore, if a hacker were to steal the chip and magnetic strip information from a POS device, it would be useless “because the stolen transaction number created in that instance wouldn’t be usable again and the card would just get denied,” said Dave Witts, president of U.S. payment systems for CreditCall.
The down side of the chip technology is that it does little to prevent online fraud or device fraud, such as ApplePay and GooglePay. Therefore it is wise to remain diligent in monitoring your transaction statements to identify any fraudulent or suspicious charges.
The magnetic strip will not disappear from the new cards to ensure they can still be widely used. Most payment terminals will begin to accept both types of cards in the very near future, if they don’t already. The new card is also widely used in most other countries as the U.S is the last major market to adopt the EMV chip. So there should be no problems with using the new card while you are on travel.
So, as these cards are being issued, it’s a great time to review PIN security. Following are a few tips to creating a secure PIN and keeping it safe:
- Choose a PIN that isn’t related to a birthday or a word that is easily associated with you or appears in your wallet or purse.
- Memorize the PIN. Don’t share it with anyone and it’s especially important not to write it on the card.
- Keep the card in a safe place at all times with the same care you take with cash.
- Use as many characters as the issuer allows or that make sense and you can remember. Keep in mind if you travel worldwide, that many ATMs outside the U.S. only allow four characters and don’t put letters on the keypads. This makes it more important to choose the PIN wisely and not use characters easily attributed to you. Consider changing it before the trip to four digits and changing it back when you return home.
- Protect your PIN by covering your hand when you enter it into a payment terminal and even at the ATM.
- Change your PIN at least every six months.
Remember that financial institutions will not send you a link to click and will never ask you to confirm your PIN or other private information. If you need to change your PIN or any other account information, you should initiate a phone call or log in to your account directly and make modifications that way.
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