How Chip and PIN Makes Credit Card Payments More Secure

How Chip and PIN Makes Credit Card Payments More Secure

MICHAEL ZETSER

MICHAEL ZETSER

How Chip and PIN Makes Credit Card Payments More Secure Chip and PIN cards have become the norm over the past decade in almost every country in the world.

M

ost people today who own a credit or debit card will have an inbuilt micro-processing chip containing the relevant information rather than the magnetic strip of older cards.

Chip and PIN makes transactions more secure in several ways.

Dynamic Data The chip is the part of the card that communicates with the card

reader at a point of sale. In older cards with magnetic strips, the strip contains static information linking the card to the owner’s bank account. These strips are relatively easy to copy if the card is stolen and data can be skimmed by thieves. With a micro-processing chip, the data contained is dynamic, which means it changes. Each transaction generates a unique code, making it almost impossible to replicate,

and the information shared with the machine is encrypted.

Objective Verification The second way a chip and PIN card increases security is through the PIN verification. Even if a physical card is stolen, it cannot be used to make transactions without knowing the secret PIN.

The second way a chip and PIN card increases security is through the PIN verification. Even if a physical card is stolen, it cannot be used to make transactions without knowing the secret PIN.

THERE ARE OTHER, EVEN MORE SECURE PAYMENT TECHNOLOGIES ENTERING THE MARKET ALL THE TIME. YOU CAN LEARN MORE ABOUT THESE BY VISITING THE BLOG OF MICHAEL ZETSER.