The End of the Swipe-and-Sign Credit Card

Beginning later next year, you will stop swiping the credit card. Instead, you will insert your card into a slot, where the machine will read a microchip, not a magnetic stripe. You'll still be signing for the time being, but the new system also enables the use of PIN numbers, if card issuers decide to add them to their cards

Here are some frequently asked questions and answers

1. Why do we need to change to chip cards?

Here's a crazy statistic: Almost half of the world's credit card fraud now happens in the United States-even though only a quarter of all credit card transactions happen here. The banks want to rein this in ASAP by moving away from magnetic-stripe cards, which are much easier to counterfeit.

2. Is this completely new technology?

Nope. Most of the world, including Europe, has been using chip cards for years. The United States is actually the last major market still using magnetic-stripe-only cards.

3. So how exactly will this affect businesses?

For starters, they'll need a new processing device to read the information in the chip cards. And come October 2015, businesses that don't have an EMV processing device could be on the hook for fraudulent chip card transactions (This is sometimes referred to as the liability shift.

Chip Cards by the Number

1.2 Billion: Estimated number of credit and debit cards that have to be ugraded to chip cards.	12 million: Estimated number of point-of-sale terminals that have to be upgraded to accept chip cards.	59%: Percentage of retail locations that will be EMV-compliant by the end of 2015.	181,000: Current number of EMV chip-activated merchant locations.
41%: Percentage of US. debit cards that will be issued as EMV cards by the end of 2015.	70%: Percentage of U.S. credit cards that will be issued as EMV cards by the end of 2015.	$3.50: Average cost for issuing a new EMV card.	$500-$1,000: Average cost of an EMV-compliant point-of-sale terminal.