EMV: Full Form, Definition, and Meaning Explained

byPaytm Editorial TeamLast Updated: October 21, 2024

EMV: Full Form and Definition

The full form of EMV is Europay, MasterCard, and Visa. It is a global standard for secure credit and debit card transactions. Also known as chip cards, integrated circuit cards, or IC cards, EMV cards are designed to improve the security of card payments by using chip-based technology. In contrast with the traditional magnetic stripes found on older cards, cards with EMV contain a microchip that encrypts transaction data and generates a unique code for each transaction, which makes it difficult for fraudsters to replicate data. Originally developed as a joint initiative, EMV is used for chip-based credit cards, point-of-sale (POS) terminals, and automated teller machines (ATMs) in the card industry. In recent times, EMV has been managed by EMV Co which is a consortium of financial institutions. 

How do EMV Chip Cards Work?

  • When you use an EMV card, the chip generates a unique, one-time-use code for each transaction. This code is used to process the payment instead of the actual card number printed on the card.
  • As a result, the merchant never sees or transmits your real card number, making it much harder for fraudsters to counterfeit your card. This technique, known as tokenization, is increasingly used to safeguard sensitive payment data. 
  • To use EMV, the cardholder is required to enter a Personal Identification Number (PIN) as opposed to the earlier method of signing a receipt by the cardholder, which is beneficial as it adds an extra layer of security.
  • Using security methods such as encryption, tokenization, and other authentication techniques, EMV cards become difficult to duplicate and reduce the probability of card payment fraud significantly. 
  • These cards can be either contact cards that are physically inserted or ‘dipped’ into a reader or contactless cards that use near-field communication (NFC) technology to be read from a short distance without physical contact. 
  • International standards related to electronic identification cards with contact cards are based on ISO/IEC 7816 and ISO/IEC 14443 for contactless cards. 

Benefits of EMV 

  • The process of tokenization used in EMV transactions ensures that card details are not shared with the merchant, thus protecting sensitive information.
  • EMV cards can use PINs or signatures for additional verification, which adds another layer of security.
  • EMV cards use PINs or signatures for additional verification which ensures another layer of security. 
  • The use of PIN and cryptographic algorithms such as Triple DES, RSA, and SHA provide card authentication to process terminal and card issuer’s host system.
  • Contactless EMV transactions are faster to complete, reducing wait times at checkout.

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