You just received your brand-new, super-secure microchip embedded debit card. Your worries about credit card fraud are gone for good. Right?
Unfortunately, no. Yes, the chip-embedded cards are significantly more secure than the old magnetic strip cards. With the old cards, using a card skimmer, an identity thief could easily copy the magnetic information and reproduce your card with someone else’s information on it. If an identity thief was lucky enough to plant a skimmer in the right location, say at a popular gas station or restaurant, he could capture thousands of cards a day. That same technology won’t work with the new microchips. In fact, there’s no easy way to reproduce the microchips, so in that sense, you’re safe. No more worrying about your card getting copied.
But that doesn’t mean the days of credit card fraud are over.
The old magnetic strip was the standard way to use your card at stores. Now the microchip will become the accepted way. But what about online?
Turns out, magnetic strip or microchip, you still have to enter your credit card number, expiration date, and security code to make online purchases. Which means microchip technology offers no security advantages in the online world.
In fact, when microchip cards become the standard in Europe, online credit card fraud spiked. Why? Not because the chip makes online fraud any easier (it doesn’t). Because in-store fraud became so much harder, identity thieves naturally migrated to the easier medium.
So don’t stop monitoring your credit card statements just yet. Yes, you can feel safer the next time you shop in-store. But don’t think for one second that the identity thieves have given up. Stay diligent!