There Could Be Something Hidden Inside Your New Debit Card

If you have a Bank of America debit card, you might soon get an upgraded piece of plastic. While many Bank of America credit cards are already enabled with chip-and-PIN technology, the company announced Sept. 30 that all its new and reissued debit cards will contain integrated circuit cards also known as chips. Given the rate of data breaches, you might get one of these new cards before your current one expires (not that you’d want that to happen, but it’s how things are going these days).

A little bit about chip-and-PIN: To use a card with this technology, you dip the card into a payment terminal, which reads the chip and asks for your personal identification number (PIN) to validate the transaction. Global card issuers and merchants have widely adopted this technology, which has been hailed as a way to improve America’s data breach problem, but there’s a big obstacle in the way of chip-and-PIN success: Many U.S. merchants aren’t equipped to read such cards.

Most cards with chip-and-PIN (also called EMV — Europay, MasterCard, Visa — which is the global standard for this technology) have the good old magnetic stripe on the back, so cardholders don’t have to worry about finding retailers capable of processing EMV transactions.

Bank of America is adding the chips to all consumer and small business debit cards starting this month. All new cards will contain the chips, and existing cardholders will receive the upgrade when their cards expire (or need to be replaced), according to a news release from the company. Bank of America has been adding EMV to consumer, commercial and corporate credit cards since 2012, and about 17 million to 20 million EMV cards were in U.S. consumers’ wallets at the end of 2013, according to the EMV Migration Forum. It’s expected that another 100 million cards will have been issued by the end of this year.

Requiring a PIN to complete a transaction has been found to significantly curb credit and debit card fraud, though there are some weaknesses in that security, like if a terminal’s chip reader has been disabled and the processing defaults to the magnetic stripe. Still, EMV cards are more expensive to produce, making them less appealing to people who buy stolen credit card data and manufacture fake cards.

There’s no question fraud-prevention technology needs to evolve in the U.S., but on the way to more secure payments systems, you have to be your own protector and monitor your accounts for fraudulent activity. Checking bank accounts on a regular basis helps stop fraud, and regularly reviewing your credit scores (you can see two of your credit scores for free on Credit.com every 30 days) could also alert you to suspicious activity on your accounts.