Chips or Magnetic Strips in Debit Cards- Which is better?

Day 216 / 365

Traditionally the atm cards or credit cards that we used had the black magnetic strips on the back of them. And to do a transaction or use them at an ATM, we need to swipe the card. Newer cards now have the EMV chip on them, that kinda looks like the circuit on a sim card. These cards are supposed to be more secure, and RBI even issued an ultimatum last year for all banks to fully migrate from the older magnetic-strip cards to the newer smart cards with the chip.

So how does this chip provide more security than the magnetic strip?

The magnetic strip of the card contains a secret code. When you swipe it, the card reader gets this code and uses it to make the transaction. This secret code remains the same for all the transactions and can be easily duplicated.

The chip, on the other hand, has electronics inside of it that generates a new code for each transaction. Thus even if someone gets a hold of this data, it's of no use as it is valid only for that particular transaction. This dynamic authentication makes chip-based cards tougher to duplicated, and hence more secure.

This post is part of my 365 Day Project for 2019. Read about it here

Yesterday’s blog —Finding Motivation