How Does Chip-and-PIN Technology Work?

How Does Chip-and-PIN Technology Work?

Technology is a staple of everyday life for nearly everyone around the world. As time has gone on, technological advancements have affected aspects of everything from communications to purchasing products or services. Chip-and-PIN technology has enabled credit and debit cards to advance as secure payment methods. Not everyone understands exactly how this works; and since this technology is the foundation for our products here at QKey, we wanted to educate you. 

How Does It Work?

Each one of these Chips is designed to function as a miniature computer. It is not powered on its own, but rather gets activated once it contacts a card reader. While the card is communicating with the reader, cryptography is being used to protect the information on the chip. 

With regards to the cryptography, the process is simple yet advanced. When connected, the chip and credit card terminal together generate an encrypted code, called a token. This token is a unique number for that one transaction. It is created using information in the terminal and instructions in the chip. Next, the token gets submitted to the card issuer. Your card issuer verifies that the transaction came from your card’s chip and that sufficient funds are available. If both are true, the purchase is approved. 

Why Is It Better?

Since the token generated during Chip-and-PIN transactions are unique to each transaction, they cannot be duplicated to make another purchase. Also, since the token is verified by the card issuer, it is confirmed that the transaction is legitimate. This provides additional security over traditional credit cards that store all information an unsecure magnetic stripe. This gives Chip-and-PIN the edge in secure payment methods. 

Chip-and-PIN technology also makes payments more accommodating for everyday situations. With Chip-and-PIN technology, the card reader does not have to have an open communication with the credit card company to process the transaction. The charges can be processed offline using the Chip, and then authorized at the end of the day by batch. This is different from magnetic strip credit cards, which require an active phone or internet connection to process. 

Chip-and-PIN Technology: The Foundation for Our Innovative QKey

Secure Chip-and-PIN technology is the foundation for our QKey. When the QKey is inserted into your computer, it comes to life with processing power. All information is stored on the QKey using encryption, and it is only unlocked when you provide the master password. QKey manages passwords, helps you process secure online transactions, and safely stores your personal information. 

QKey gives you full control over your information and provides an ideal method of making secure payments. Contact us to learn more about our innovative technology and how it can help you take control of your sensitive information.