If you’ve received any new credit cards in the last year or so, take a close look: There may be a microchip right above the card number. While that tiny chip can be easy to miss, soon it won’t be – starting this week, many retailers are using it to make a small change in your checkout process.
Because this tiny chip offers much greater security benefits versus traditional signature-based, magnetic stripe technology, on Oct. 1 many retailers, including Walmart, will begin prompting customers not to swipe, but to “dip” – aka insert and briefly leave the card in the payment terminal.
Here’s how it works:
Using a chip card to pay means the chip assigns a dynamic code that changes each time consumers use the card. Even if the code were obtained, it could not be used to make an additional purchase. So when considering the risk of counterfeit, a chip is much more difficult to duplicate.
So why the significance of Oct. 1? That’s the date set by Visa, MasterCard, American Express and Discover for the liability of credit card fraud to shift from credit card issuers to retailers. Merchants that haven’t changed their terminals to read chips could be responsible for fraud.
Walmart has long been pushing toward payments that give our customers more security than the traditional signature-based, magnetic stripe technology. In fact, here’s something else you may not know: We began installing hardware that had the capability of accepting microchip cards more than nine years ago, and we activated the functionality on Nov. 1, 2014. Additionally, in 2014, both Walmart and Sam’s Club issued chip-enabled MasterCard cards to our branded cardholders.
While the cards are changing, you will still have the quick, simple checkout experience you're accustomed to at Walmart and Sam’s Club. If you don’t have a microchip card, you can continue using your magnetic stripe card at Walmart and Sam’s Club just the same. In fact, when it comes to debit cards, many banks have not issued chip-enabled cards anyway: Only 25% of debit cards will be transferred to the new system by the end of 2015, according to a recent study by Pulse, a PIN debit network.
Walmart was among the first retailers to implement chip technology to better secure payments for credit card holders, and now, we’re finally starting to see this shift take place.
For additional resources regarding chip-enabled payments, visit the news section of our website.