The EMV cards replace the traditional magnetic strip on the back with a small chip that holds encrypted data. It allows merchants to verify a card’s authenticity, providing the cardholder greater security and making the EMV card less vulnerable to hacking while the data is transmitted from the point of sale (PoS) to the issuing bank.
But the FBI says that may not be enough. It says EMV cards can be counterfeited using stolen card data obtained from the black market.
The FBI says the best defense is for consumers to use a PIN instead of a signature when making purchases.
The retailers complain that virtually all of the chip cards being issued in the US are chip-and-signature rather than chip-and-PIN, leaving consumers without the option to use a PIN. By contrast, EMV cards used in 80 countries around the world for 20 years or more are routinely chip-and-PIN.
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