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VOL. 131 | NO. 153 | Tuesday, August 2, 2016

Make the Most of Your ‘Smart Chip’ Card

BY Jason Lee

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Whether at the grocery store or your favorite local boutique, you may have noticed an increasing number of people “dipping” their bank or credit cards rather than “swiping.” This is thanks to the continued roll-out of the EMV, or “smart chip,” cards. 

The introduction of these chip cards has raised many questions from our members. As a trusted partner, we’re here to help our members navigate the waters of new financial trends and technology, as we believe these efforts to promote financial literacy help build a better Memphis. Let’s go over some of the most common questions we’ve been asked:

Roll-Out Timing: EMV – which stands for Europay, MasterCard and Visa – is a global standard for cards equipped with computer chips and the technology used to authenticate chip-card transactions. Banks and credit unions began rolling out EMV cards in spring 2015 in the form of new credit and debit cards. Approximately 25 percent of U.S. debit cards were issued as EMV chip cards by the end of 2015, according to Debit Advisory Service. That rate is expected to reach 57 percent by the end of 2016. You’ve probably noticed that many merchants are updating their technology to keep their customers safe and to protect their businesses from fraud and data breaches. 

Technology and Usage: EMV cards are designed to keep your money and data more secure, but have several different applications – sometimes you can “dip” your card – inserting it into the new card readers – and sign, while other times you’re asked to enter a PIN. You should keep in mind that the choice to sign or use a PIN is up to you – many of our members find signing a more convenient option. EMV cards are more secure, because unlike traditional magnetic-stripe cards, every time an EMV card is used for payment, the card chip creates a unique transaction code that cannot be used again; making it much more difficult for your personal data to be replicated. 

EMV cards have already been widely introduced throughout Europe, and have dramatically cut down on credit card fraud cases in the countries where they’ve been introduced. A recent study from Barclays states about 31.8 million U.S. consumers had their credit cards breached in 2014. Most experts believe that the reason the U.S. had a higher rate of fraud is because we were slower to adopt EMV cards. With this being said, you may wonder if it’s safe to use your debit card. Well, the answer is yes – with EMV technology, your card is safer than ever.

How do you get your new card? Most financial institutions, including Orion, have already contacted their members to send out new cards. More than 25,000 of our members received their EMV cards last November. If you have not received a new chip card, reach out to your financial institution to learn more. 

Hopefully this information will help you make the most of the EMV card technology and keep your finances safer than ever. Just remember, the old rules of financial literacy still apply – always check your statements for accuracy to be sure there are no fraudulent charges to your account, and continue to work with your trusted financial partner to fulfill your long-term financial goals. 

Jason Lee is chief financial officer of Orion Federal Credit Union.

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