Chip Debit Card
A chip debit card is simply a regular
debit card, but with a microchip instead of (rather, in addition to) the usual 'magnetic stripe'. The physical card
looks and feels the same.
The power of the chip over the magnetic stripe is in the
SECURITY; a microchip can hold a huge amount of information, and this information can be ENCRYPTED, which means it
can have a much more difficult 'code' to break than the stripe. The chip, with it's huge information capacity and
ability for encryption, is considered much more resistant to credit card and debit card fraud, and is seen as the
next generation in secure payments using bank cards.
The chip stores the same information as the magnetic
stripe, but it also stores more information, and in a safer, encrypted form. You use chip debit cards in the same
way as you'd use your regular debit card. As of 2008, banks in Canada are beginning to switch over to chip debit
cards. It is a slow switch though, with plans to make a complete switch-over by anywhere from 2011 to 2014. These
cards will all still retain the magnetic stripe, so they can be used in other countries that don't have the chip
technology in bank cards.
At the moment, only a few countries in the world have
adopted the chip debit card, and Canada is spearheading this movement in North America. The United States has not
yet made plans to switch to the chip in debit or credit cards. If you're unsure whether a bank machine accepts your
chip debit card, you can look for the following 'chip card accepted' symbol on the ATM.