Over the course of 2015, major credit card companies throughout the United States will roll out EMV cards to replace the classic magnetic strip credit cards and hopefully prevent some types of fraud, which have been creeping up more and more in the headlines. These new EMV, or “chip and pin,” credit cards decrease fraud because the computer chip inside each card creates a unique code for every transaction and such code cannot be used again. Traditional magnetic strip credit cards store data on their strips, which allows third parties to easily copy and reuse stolen consumer credit card data.

Additionally, the major credit card companies are also urging legislators to revise the rules that affect financial institutions in data breach situations.  These companies are seeking a change to be implemented by October 1, 2015, by which the cardholder’s liability would remain unaffected, but the liability among financial institutions and retailers would fall upon whichever party had the least advanced, secure technology at the time of the breach with respect to the EMV credit cards.

While fraud in retail stores may decrease as more customers use these EMV credit cards, online transactions will not be afforded any greater protection. We could see a shift in retail store breaches to more and more online transaction breaches if the EMV credit cards make it too difficult for hackers to reach the retailers database. When the United Kingdom made this switch, online credit card fraud increased by almost 80% within three years.  Keep this in mind as your credit card companies provide you with new EMV cards.