David Lerner Associates: New Card Chip Technology Questions
This month the U.S. is instituting the new EMV (Europay, MasterCard and Visa) chip technology in credit and debit cards to help stem the tide of fraud and identity theft that results from hacking and security breaches. The purpose of this new chip is to keep thieves from easily accessing a consumer’s personal information. Banks and credit card companies have been sending their clients new cards with the chip embedded in the strip.
As this is a new technology being introduced to the U.S., many Americans have questions about their card:
Can I still use my old card?
The October 1st date for implementation applies to merchants, not consumers. So yes, you can still swipe your card. But be aware that fraudsters know these old card readers are the easiest to hack into, so you should be wary of any merchant that still asks you to swipe rather than ‘dip’ your card into the new EMV card reader. The upside for you is that if a retailer or small business does not upgrade their system in October and they get hacked, they will be held liable for any fraudulent use of a card.
Can I use my chip card if the retailer hasn’t upgraded yet?
The new cards have both a stripe and a chip, so they can be used in either system.
How does this affect online shopping?
Since there is no physical card reader to dip your card into when you shop online, EMV will have no impact on online shipping. You are still vulnerable to credit card theft. In fact, Nerd Wallet found that online fraud in the U.K. has risen 120 percent in the last 10 years.
What about ATMs?
If the ATM has a chip reader, it will prompt you to put your card in a second time. It will hold the card until the ‘dip’ and the transaction is complete. In this case, remember to get your card back once you are done.
Credit card fraud and identity theft have become one of the biggest crime problems in the U.S.
It is hoped that this new chip technology will make a difference once it is fully implemented.
Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities.
To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law.
Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable-- we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.
David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances. Member FINRA and SIPC. http://www.davidlerner.com
Founded in 1976, David Lerner Associates is a privately-held broker/dealer with headquarters in Syosset, New York and branch offices in Westport, CT; Boca Raton, FL; Teaneck and Princeton, NJ; and White Plains, NY. For more information contact David Lerner Associates Call 516-921-4200 Visit our website: www.davidlerner.com
Connect With Us