Why Chip & PIN?
The desire to reduce fraud was one of the key reasons behind the introduction of chip and pin terminals and card readers because magnetic stripe and signature systems are more susceptible to fraud. It is possible to forge a signature whereas the PIN code is unique to the cardholder and only the cardholder knows the number (this is why you should never reveal your number!).
With the swipe cards, it was also possible to clone the card with a relatively cheap machine, as the information in the magnetic stripe could be easily copied. Cloning a card with a chip is much more difficult, and in most cases not feasible. The UK was one of the first countries to introduce the chip & PIN in 2005 and since then there has been a dramatic reduction in fraud. In France, for example, there was a reported 80% reduction in fraud after Chip and PIN terminals were introduced.
New generation Chip & PIN terminals
Chip and PIN technology has been around for many years but over the last couple of years there has been some exciting developments in this field with the arrival of mobile Chip and PIN terminals. New companies like iZettle and SumUp have developed their own apps to accompany a Chip and PIN reader that enables smartphones and tablets to take card payments. This solution is ideal for small businesses and service providers in any sector since it is a flexible and low cost solution as well as secure.