EMV®: What you need to know

What is the Card called?

As the US payment industry transitions to EMV technology, there is a lot to adjust to, starting with the terminology. The following terms all mean about the same thing:

  • Smart card
  • Chip card
  • Smart-chip card
  • Chip-enabled smart card
  • Chip-and-choice card
  • (PIN or signature)
  • EMV smart card
  • EMV card

What is a Smart Card?

A smart card resembles a credit card in size and shape, but inside it is completely different. First of all, it has an inside -- a normal credit card is a simple piece of plastic. The inside of a smart card usually contains an embedded microprocessor. The microprocessor is under a gold contact pad on one side of the card. Think of the microprocessor as replacing the usual magnetic stripe on a credit card or debit card.


Anatomy of a Smart Card

Anatomy of a Smart Card

How do Smart Cards reduce fraud?

Chip and signature validates card is authentic
  • Proves to issuer that this card is valid
  • Avoids counterfeit cards
  • Very difficult to copy
Chip and PIN validates cardholder
  • Proves cardholder is legitimate
  • Pin avoids lost and stolen fraud
Enhanced risk management
  • Chip can be updated post issuance
  • Card can be programmed with spending and usage limits

How to use a Smart Card?


At chip-reading terminals, users typically dip the chip end of the card into the terminal, removing the card only when prompted to complete the transaction. Card stays in the reader for the entire transaction


At traditional terminals, users continue to slide card through the magnetic stripe reader


Users enjoy tap-and-go convenience for speedy transactions at terminals displaying the “contactless” symbol. Typically a card must be less than an inch from the terminal; a tap is recommended