Editorial Policy

Should You Get a Chip-and-PIN Card?

Eva Norlyk Smith Ph.D.

June 3, 2013

With chip-enabled credit and debit cards increasingly available from issuers, U.S. consumers might find it easier to avoid unpleasant “card-not-accepted” surprises when traveling overseas.

However, chip-enabled cards issued in the U.S. aren't necessarily easy to get — and aren't created equal, meaning travelers can still expect some snags.

What are chip cards?
Europe, Canada, Mexico and large parts of Asia have long been using chip-and-PIN bank cards, which use a chip embedded in the card in lieu of a magnetic stripe to store cardholder information. The technology is also known as EMV, which stands for “Europay, MasterCard and Visa,” the three large payment networks that first introduced the technology. Chip-and-PIN cards require a personal identification number (aka PIN) for verification with each transaction. Because the chip encrypts data uniquely for each transaction, chip-and-PIN cards are more secure than magnetic-stripe cards, which can easily be skimmed, copied and used by fraudsters.

Do you need a chip-and-PIN card if traveling abroad?
While U.S. credit cards using magnetic stripes are accepted by many overseas hotels and larger stores, U.S. travelers may run into issues when trying to use their mag stripe cards with smaller vendors and at automated payment machines. In many European countries, payment kiosks have replaced live attendants for numerous services, including purchasing rail or transit tickets, paying tolls and buying gasoline. Imagine arriving at a rail station or subway for a late-night train, only to find that your credit card is not accepted and no attendant is available to help.

How can you get a chip-and-PIN card?
Chip-enabled credit cards are slowly making their way into the U.S. Major card issuers, including American Express, Bank of America, Chase, Citi, US Bank and Wells Fargo, are issuing one or several credit cards featuring a combination of both chip and magnetic-stripe technology. For most banks, however, this type of card is not made available automatically; you have to request it, and the option is typically available only on select credit cards. For a current list of U.S. credit cards with EMV technology, check out this chart courtesy Flyertalk.com, which features the most up-to-date list of U.S. chip-enabled credit cards.

Prepare for some hiccups
Many U.S. credit cards with EMV technology differ somewhat from their European counterparts. EMV cards issued in the U.S. are often what is known as “chip-and-signature” cards, which means you'll verify your identity via a signature, rather than a PIN. So, while the chip technology makes these cards more secure against skimming than magnetic-stripe cards, signatures are easily forged.

“Chip and signature cards offer enhanced security over traditional magnetic-stripe cards, but they are less secure than chip-and-PIN cards” says Tim Winship, editor-at-large at SmarterTravel.com. “So they're an improvement, but only a halfway measure.”

Plus, travelers holding chip-and-signature cards may run into the same problems with card acceptance as they would with magnetic-stripe cards. Automatic kiosks won't accept signatures. Plus, smaller merchants may not be familiar with the chip-and-signature variation, expecting a PIN to be entered and may simply reject a card amid the confusion.

The only U.S. banks currently offering true chip-and-PIN cards include PenFed, Wells Fargo (which is still offering chip-and-PIN cards only to select customers as part of its beta-testing period), credit unions that cater to government and NGO travelers (such as State Dept. FCU, UNFCU and NC SECU)  and USAA Savings Bank.

So what is your best option, if you don't want to get another card just for its EMV capabilities? Carry enough extra cash for situations where you might get stuck. Your U.S. credit cards should be fine for many of your overseas purchases, but for train stations, toll booths, bridge crossings and other places with automated payment kiosks, expect to have to pay in cash — and carry small bills and coins, as some kiosks are limited in what they accept. In some cases, an attendant might be able to help you process your magnetic- stripe card, but don't rely on it.