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What type of EMV Chip + PIN credit card works best?

by on Thu June 25, 2015 • No Comment


EMV chips are becoming a standard feature for credit cards in the U.S. this year, so there’s a good chance a card in your wallet has a chip, or will soon get one.

Having the chip can make international travel easier, especially in Europe, where swiping the old fashioned magnetic stripe is frowned upon, and sometimes not accepted at all.

But not all cards with an EMV chip are created equal, which can be incredibly frustrating.

Here’s a rundown of the three major types of EMV chip cards for U.S. accounts and where they will and won’t work:

OK: Chip, no PIN backup

This is the kind of card you most likely have. When you make a purchase with the chip it will ask for a signature to verify your identity first. If that’s not possible, like at some train station or gas station terminals, it will approve the transaction if the merchant is set up to allow transactions that have no signature or PIN.

Otherwise the card won’t work and the transaction will be declined, leaving you stuck.

Where it works:

Places with an EMV reader that can print out paper for a signature, like most restaurants, hotels, and large stores.

Where it sometimes works:

Places that can’t take a signature like a toll booth, but where the merchant has agreed to take payment without any signature or PIN verification. Many kiosks allow this for small transactions, but unfortunately there are no hard and fast rules, and it’s almost impossible to tell ahead of time whether a kiosk will accept your card.

Where it won’t work:

Places that insist on a PIN for the transaction. Some shops burned by fraud may refuse any signature transactions, and many kiosks require some sort of PIN verification. You might be able to use your cash advance PIN if you’ve set one up in advance, but that’s hit or miss, and only if the merchant has a live connection to the payment network. A remote location that doesn’t have a live connection may not work.

Cards that work this way…

All newly issued Chase, Citibank, and American Express issued cards with a chip.

Better: Chip with PIN backup

This type will first try to get your signature, and if that’s not possible will prompt for your PIN to verify if needed.

Where it works:

Places with an EMV reader that can take a signature.

Places that can’t take a signature, but will accept a PIN.

Where it won’t work:

Some places that want a local card, or that cough up when the card tries to ask for signature verification first.

Cards that work this way…

Newly issued Wells Fargo cards, the Barclaycard Arrival Plus, State Department Federal Credit Union, USAA, PenFed, Navy Federal cards, among others. There are reports of some Bank of America cards having a PIN issued, but so far they haven’t formally announced support of PINs for transactions that aren’t ATM cash advances. The Barclaycard Arrival Plus offer is no longer available.

Best: Chip with PIN priority

This kind of card will not ask for your signature at all when you use the chip. It will either ask for your PIN, or if none is required, proceed with the transaction.

Where it works:

Places with an EMV reader that can take a signature.

Places that can’t take a signature, but will accept a PIN.

Where it won’t work:

Some places that want a local card.

Offline kiosks when your card doesn’t have an online PIN option.

Cards that work this way…

UN Federal Credit Union cards, First Tech Credit Union cards (by Fall 2015). Diners Club cards with a chip also have PIN priority, but those aren’t currently open to new applicants.

What should you choose?

  • If you tend to carry some cash around, you’ll be well served with the basic EMV chip you probably already have on your favorite rewards card, and using cash when the card doesn’t work, though this may not work at some kiosks that don’t accept cash. We list some good all purpose cards for international travel here.
  • You might also have a *debit* card from your bank with a chip built in, and it can work in places where a PIN is needed. Chase for example has issued over 5 million debit cards with chip and PIN functionality.
  • The downside is while debit card transactions have 100% fraud protection from Visa and MasterCard, if fraud happens the money comes directly out of your checking account. And most banks charge foreign transaction fees when you use a debit card.
  • But if you don’t want to think about debit or cash, consider one of the credit cards with the PIN backup. There are several with no annual fees and a few that avoid foreign transaction fees altogether. That should cover you most places.

If you’re really obsessive, then go for the few cards with PIN priority.

There isn’t a large advantage in terms of acceptance since having a card with a PIN backup will have you covered just about every time.

But if you don’t want to rely on signing and like being a step ahead of big banks, go for it. Or if you are planning to use a lot of gas stations or toll booths where there aren’t any backup options.

Unfortunately the only no annual fee option from UN Federal Credit Union has a 1% foreign transaction fee, which makes it less appealing.

If you can wait until the end of the summer when First Tech rolls out PIN priority, you can pick up its Visa Platinum Points Rewards card. It has no annual fee and no foreign transaction fees.

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