This new chip card technology — called EMV, which is short forEuropay, MasterCard and Visa —sends a one-time code to processpayments, rending duplication efforts useless and therebyincreasing payment security.
Unlike credit cards using a magnetic strip to store paymentprocessing information that does not change, chip-enabled cards aredifficult to counterfeit. They use a unique code that can’t be usedmore than once. If a hacker steals credit card information from achip-enabled card, it’ll be denied at the point of sale. The changeis designed to reduce counterfeit card fraud, which makes up 37% ofall credit card fraud in the U.S.
Oct. 1, 2015, marked the deadline for these changes to takeplace. On that date, the liability for counterfeit credit cardfraud switched from card issuers to merchants. (The one exceptionis gas stations, which won’t become liable until 2017 because theirpayment collection is typically built in to the gas pumps.)
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