Chip and Pin Bank Cards

US banks are finally rolling out a new and more secure type of debit and credit card technology that should strengthen their security. Currently cards use a magnetic strip that holds the card number and expiration date which provides very little security since the card number is being transmitted over the point of sale device and the magnetic strip makes it easy to clone a credit card with stolen information. The EMV “smart card” technology (a joint effort of Europay, MasterCard, and Visa) cards have a built in chip that replaces the functionality of the magnetic strip. However, the chip provides much more security because every time it is used, it generates a one-time transaction code that is cryptographically signed and transmitted. This means that if thieves are able to skim a point of sale terminal or hack into a retailer’s network the codes they steal are worthless. This could have prevented much of the damages caused by breaches like Target, where millions of card numbers where stolen.
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These EMV card are not exactly new technology since they have been available since the early 2000’s and most of the rest of the world has already adopted them as the gold standard. The roll out in the US has been very slow because of the great costs of issuing new cards and upgrading point of sale terminals at retail locations. However, with the rise in identity theft and credit card fraud at an all time high, the credit card companies are pushing for the new more secure technology. They are forcing the retailers to transition to the EMV chip and pin terminals by setting a deadline of October 1st, 2015. After that all any company that accepts credit and debit card payments but doesn’t have chip and PIN readers in place could face increased liability and fines for fraudulent transactions incurred if card data is stolen from them.
Author: Charles Leavitt

Source: http://www.wired.com/2015/04/hacker-lexicon-chip-pin-cards/

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