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Posted on Feb 4, 2016 | 22 comments

Waiter! There’s a chip in my card.

How technology is making your credit card safer.

Credit and debit cards with microchips in them – maybe you’ve noticed a small patch of silicon on your plastic – are far better at protecting your private information than cards with only magnetic stripes.

Chip cards help prevent fraud in transactions where you physically use your card, as opposed to buying something online.

“They’re virtually impossible to counterfeit,” said Danny Jones, STCU’s director of remote services, including credit cards.

To most of us, the magnetic stripes on our debit and credit card look like … stripes. To thieves, this decades-old technology is teeming with data – names, credit card numbers, and expiration dates they can pull off to make fake cards.

Unlike a magnetic stripe, the microchip generates a unique code for every transaction. That one-time code lets the merchant make the sale, but it’s useless to thieves. And, unlike some old cards that used RFID (radio-frequency identification) technology, the new technology makes it impossible for high-tech thieves to read your credit card data from a distance. No need for a “special” wallet to protect your chip-enabled card.

The chip cards are the standard overseasThis link opens a third-party website that is not affiliated with STCU., where they’re also known as smart cards, chip-enabled cards, and EMV cards (for Europay, MasterCard, and Visa). But the United States is just transitioning to them now.

Chip-and-PIN v. chip-and-signature cards

Not all chip cards work the same.

While they all come embedded with that microchip that creates the unique codes, some also require a signature, while others require you to enter a personal identification number to verify that you’re the cardholder.

Many card issuers are rolling out chip-and-signature cards, Jones said, because they figure they’re easier for cardholders to get used to. STCU is transitioning to chip-and-PIN cards, because they’re more secure, he said. A PIN is harder to guess than a signature is to fake – and you might have noticed merchants rarely verifying your scrawl at the cash register.

Change comes slowly to checkouts

Whether your chip card requires a PIN or a signature, it also requires your favorite retailers to invest in some new equipment to read the chip.

While there’s no legal mandate for card issuers and merchants to adopt chip-card technology – and install terminals that can read your microchip – they have incentive.

Historically, liability for counterfeit-card fraud rested with card issuers. But starting in October 2015, that liability shiftedThis link opens a third-party website that is not affiliated with STCU..

“Now whoever is the least secure, whether it’s the issuer or the merchant, is going to be the one who absorbs the fraud in a transaction where the customer has a chip card,” Jones said.

There are exceptions. Self-service gas pumps, for example, have until 2017 to accept chip cards before the gas stationsThis link opens a third-party website that is not affiliated with STCU. are liable for fraud.

When there’s a choice, choose the chip

The United States is in conversion mode, with some businesses choosing to accept the liability risk – for now, at least – rather than buy the new devices.

That’s why the chip cards also have magnetic strips, and why the magnetic strips still work on most terminals. But it’s safer to use the chip rather than the stripe when you can.

“Until we pass a critical mass, where enough merchants are accepting chip cards, then you’re going to see both forms of technology in place,” Jones said. “Ideally, maybe in the next five years, we’ll see the magstripe go away.”


  1. False. All of my cards have chips in them. However, my Capital One card is not only locked in a safe, but yesterday someone was dining and shopping with it. Also, of all hellish places, Walmart is the only place where I have used any of my chips. I still swipe like it’s the 90’s everywhere else… that’s right, they get out that heavy piece of equipment from under the counter that stamps your card to a carbon copy receipt.

    • Torben, the chip and pin security helps ensure that your card is safer during in-person transactions, but unfortunately no process is foolproof. This is why we encourage everyone to check in to the fraud monitoring services offered by their credit card issuers. As to the swipe vs chip, as the article outlines, it is up to each merchant to determine how to process credit cards. While there’s no legal mandate for card issuers and merchants to adopt chip-card technology – and install terminals that can read your microchip – they have incentive thanks to the liability shift.

  2. I asked at the South Hill branch why my new card didn’t have a chip. They said they weren’t going to have chips and they were going to switch over to Master Card. I also asked why the numbers were printed and not embossed and your employee didn’t know. IF STCU does not take my financial seriously I will go to another financial institution who is actually putting best practices in PLACE and not just POSTING about them online!

    • Liz, we’re sorry about your experience at the branch and will be looking further into it immediately. All STCU cards – both credit and debit – will have chips. Credit cards have already been sent out, and debit cards will be sent out in the next couple of months. We do take member financial security very seriously, which is why we are implementing chip-and-pin security (the most secure option) with all chip cards. We will be reaching out to you shortly to answer this and any other questions you may have. Thank you for your membership!

  3. When is STCU going to start sending out the new cards?

    • Todd, the STCU credit cards with chips have been sent out – if you haven’t received one, please contact us to let us know. Chipped debit cards will be sent out to members in the next few months – keep an eye out for more information soon!

  4. Many card holders use a protective sleeve to thwart the stealing of information from their credit cards. By using the chip with a pin is this still necessary.

    • The protective sleeves are used to prevent contactless chips from being read from a short distance away. STCU is not issuing contactless chips, instead choosing the contact-only chips that are required to physically come into contact with a reader (by inserting the card). So those protective sleeves would offer no additional benefit to members since STCU’s chip-enabled cards do not contain the type of chip those sleeves were designed to protect.

    • Joanne – if you have a credit card with STCU, your new card should have arrived. If you have debit cards, then chip cards are on their way and should arrive in the next few months. Please feel free to reach out to us at if you have any questions or concerns!

  5. So I just got a new debit card in the mail last week and got all of my auto-debits switched to the new card. Does this mean that I’m going to have to switch everything again when the chip debit card comes out?

    • Krys – Yes, when your new EMV chip debit card arrives it will have a new account number. We know the process of changing those auto-debits can take a while. However, we feel that the upgrade to EMV security will be worth it for our members!

  6. What about restaurants that do not have a pay-at-the-table option? I assume that I should not ever give out my PIN to anybody else, so does that mean I’ll have to get up from my table, cross over to their point-of-sale system, and enter my PIN there? Or will these cards also work as chip-and-signature where I still sign the slip?

    • Kurt – you are correct that you should not give out your PIN. These cards do also work as chip-and-sign if the restaurant or retailer you are at has not implemented a pay-at-table chip-and-PIN option. They do also still have the magnetic strip if the retailer is still using swipe-and-sign technology.

  7. Will we be required to pay a yearly fee for the new cards, at some point in time? Not sure that makes me feel better. If we will be required to pay a yearly, or monthly fee for the card, it’ll be seniors that feel it the most.

    • Hi Jacob –
      There are currently no plans to charge a yearly fee for STCU debit cards.

  8. I received my new debit card in the mail yesterday, I tried to activate it on line but since it’s a PIN card , I got a message that said I need to go into a local branch to have it activated ,is this normal?

    My question is:will it still work at those merchants that use to ask if it was credit or debit and would run it as a credit card.?Seems like allo of stores apparently don’t take debit cards

    • Ken-
      Yes, the debit cards require that you either call 1-866-762-0558 (the number on the sticker) from your home/primary phone you have on file with us, or go in to a branch. Since debit cards attach directly to your account, there’s additional layers of security to set the PIN.

      And yes, these cards will still work if the merchant runs them as credit. The chip-and-PIN security with the cards ensures that the card is compatible with the highest level of security that the merchant chooses.

  9. I got gas at Safeway yesterday and it did not recognize my new MasterCard chipped debit card and therefore is charging me .10 more a gallon for gas. Is there a trick to using the new debit card so that it is recognized as debit?

    • Peggy, we have gotten a few reports of select Safeway gas stations that are having this issue; we are working with Safeway’s financial institution to get their system settings updated as quickly as possible. Could you send us an email at with details of which Safeway gas station this was so we can ensure they’re on our list? Thank you!

  10. I strongly disagree with your assertion that contactless (RFID) technology is unsafe or allows card info to be stolen at a distance. I’m sure your network partner would also disagree. Throughout most of the world, contactless is the standard for small transactions because it’s just as secure (against copying, it doesn’t need the PIN thus the value limit) and much faster than a contact chip transaction.

    The best, most consumer-friendly, banks are issuing dual-interface cards capable of contact and contactless transactions.

    • Allie, we appreciate you taking the time to let us know what you think. There are a number of considerations when evaluating contact-only vs. dual interface (contact + contactless) chip cards, including security, retailer adoption, cost, and newer alternatives to contactless chip cards, such as Apple Pay, Android Pay, and Samsung Pay (all of which we do offer for our credit cards). We have forwarded your comment to our card management team; please let us know if you would like them to reach back out to you directly to discuss further.

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