The days of swiping your credit card in a reader and signing for your purchases are coming to an end in 2015. America is in the process of joining the rest of the world in adopting the European “EMV – Europay, MasterCard and Visa” technology to process your credit and debit cards.

How Will Credit Cards Change?
Currently, your credit card has a black stripe on the back that contains information about you and is used to approve or decline transactions. The information in that black strip never changes unless you are issued a new card. This makes it easier for criminals to counterfeit your card.

Your new EMV card will have a small square chip instead of a black stripe. This electronic chip will communicate with your financial institution and issue a transaction code that can’t be used again. So even if criminals got your card number it would be impossible for them to use the card due to the constantly changing code.

How Will The New Cards Change My Lifestyle?
You may run into problems when you travel if you have a non-chip card. European countries have been using the chip technology for many years to cut down on fraudulent purchases and may be reluctant to take a magnetic strip card for high priced items. If you don't upgrade your credit card you may need to carry more travelers' checks or local currency.

You will still be able to buy things online just like you have in the past. Online or phone ordering will stay the same as it is now. Some retailers may add some additional security to make sure you are who you say you are.

In the future computers will come equipped with “tap” technology where a simple tap of the card on your computer will work. This is also in the planning for merchant terminals. You will ring up purchases then tap and go.


When Will All These Changes Take Place
They have already started in some parts of the country. It’s estimated that 100 million new cards will be issued by the end of 2014, and 1.1 billion by the end of 2015.

Thirteen million merchants will need to upgrade their credit card processing terminals at a cost of $500 each. [Free EMV chip card terminals are available for a limited time locally with Frontline Processing]. If merchants fail to upgrade they will be charged back for any fraudulent purchases with and fraudulent or counterfeit cards.

About 40 percent of debit cards will be EMV cards by the end of 2015 and 70% of all credit cards will be EMV cards by the end of 2015. Eighty-six percent of financial institutions will be issuing cards in the next two years.

Some Final Thoughts
The EMV system has proven to drastically reduce credit card fraud in Europe. So it’s a good thing from that point of view. It’s taken so long for America to catch up because of the cost to merchants and financial institutions. It will cost about $3.50 per card to make and issue an EMV card.

Due to the growing numbers of major retailers who have been hacked the message is finally getting through. This technology should keep your money safer. And it’s a technology that’s been proven to work for many years.

The downside could be that people are a little skittish about the word “chip.” To some it’s another word for “Big Brother is Watching You.”

Either way, the technology is coming and hopefully, it can reduce fraud and theft and that’s good for all of us.