5 things to know about Chip plus PIN based credit cards

1. The RBI has directed banks to issue chip plus PIN based credit cards instead of the magnetic strip credit cards that were used earlier.

2. A chip plus PIN card has a chip embedded in the card that holds encrypted information about the card and transactions.

3. A PIN is provided as a second measure authentication for authorising the use of the credit card.

4. When a chip-based card is used at the point of sale terminal, the terminal reads the encrypted information on the card and prompts for a PIN. The transaction processed only if the PIN is entered correctly.

5. A chip plus PIN card offers protection against counterfeiting and prevents lost and stolen card frauds.

(Content is courtesy Centre for Investment Education and Learning ( CIEL). Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.)