EMV card

An EMV card, commonly known as a chip card, smart card, or PIN-and-chip card, is a type of credit or debit card that is equipped with an embedded microchip. This chip enhances payment security significantly more than traditional magnetic stripe cards. The EMV acronym stands for Europay, MasterCard, and Visa, the three companies that originally created the standard.

The embedded microchip in EMV cards is designed to interact with compatible point-of-sale (POS) terminals during transactions. When an EMV card is inserted into a POS terminal, the chip generates a unique transaction code that cannot be reused, which is known as a dynamic authentication process. This makes it extremely difficult for the card to be cloned or for the transaction data to be fraudulently reused.

Additionally, EMV cards often require the cardholder to enter a PIN (Personal Identification Number) to complete the transaction, adding an extra layer of security by combining something the user has (the card) with something the user knows (the PIN). This technology not only reduces the incidence of card-present fraud but also provides global interoperability as more countries adopt the EMV standard.