FAQ: What are chip cards?August 11, 2015
Also known as an Integrated Circuit Card (ICC), a chip card is equipped with a microprocessor that uses its own operating system.
Think of a chip card as a miniature computer: It can interact with other devices as well as store, share and encrypt data. Some ID card printers produce ICCs, allowing both government agencies and enterprises to enforce tighter security protocols throughout their facilities.
How was the technology created?
Chip cards were developed as a result of a joint effort between Europay international, MasterCard International and VISA, which formed EMVCo. According to Paragon Application Systems, the three organisations intended to establish chip card specifications that :
- Could communicate with acceptance devices (ATMs, security terminals, point-of-sale systems etc.) to determine whether they were authorised to process data stored by the chip.
- Acceptance devices could operate applications to ensure that risk control and security measures were employed during payment transactions.
Although EMVCo focussed on payments, the technology could be applied to identification. Companies simply had to equip their facilities with acceptance devices that were compatible with chip cards.
Why do chip cards offer better protection?
Magnetic stripe cards are only capable of storing data, lacking the communication and encryption abilities of ICCs. These cards are often more susceptible to counterfeiting and skimming. In addition, it’s easier for malcontents to use them if they’re stolen.
Chip cards, on the other hand, deliver a couple of features that make it more difficult for hackers and other parties to steal cardholder information:
- Whenever a person initiates a transaction, the chip card produces a unique code that is authenticated by a third-party. A person attempting to commit fraud could not use this code to create a fake card, because the stolen code is only good for one process.
- When an ID printer creates a chip card, the card is equipped with a private key assigned to a specific cardholder. This means that the data stored in the chip can only be accessed or processed through the cardholder’s discretion.
There are a number of other security features inherent in this technology. Overall, chip cards are delivering a new level of communication protection to the modern workforce.