Chip cards have holes

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The move to so-called chip cards is expected to begin in earnest in October 2015. That’s when credit-card issuers will shift the cost of fraud on transactions that involve credit or debit cards that have only a magnetic strip to merchants who fail to upgrade to chip-card processing equipment.

Chip cards are much more secure. However, the new system doesn’t solve all of the issues of credit-card fraud, experts tell Consumers Digest.

Most European nations that use chip cards require card users to enter a personal identification number, or PIN. Banks, however, want to make the transition to chip cards easier for

U.S. consumers, so they’ll require only a signature for chip-card transactions, says Matt Schulz of, which allows consumers to compare credit-card offers.

This makes so-called chip-and-sign cards easier for thieves to counterfeit and use, Schulz says, because it’s easier to forge a signature than it is to guess a PIN.