Cards with a chip

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Cards with a chip or smart cards are plastic cards of a standard size with a built-in microprocessor (chip) for storing information.
Despite the high cost of manufacturing chip cards, they have a number of significant advantages over magnetic stripe cards:

• Security. The chip is almost a full-fledged computer in which the data is protected by cryptographic algorithms, and the information cannot be copied when directly connected to the chip, so it is almost impossible to make a duplicate
• A transaction or exchange of information with an acquiring bank (a bank that organizes payments for bank cards). Each transaction is confirmed by a new specially generated code, so intercepting this code does not make sense
• Longer service life. The chip card can be used for more than 6 years, which significantly exceeds the service life of the magnetic stripe - 2-3 years
• Off-line transactions. Operations with smart cards, unlike magnetic ones, do not require on-line confirmation and can be transferred to an acquiring bank or processing center in a deferred mode.
• A wide range of additional applications. The release of chips is possible, the volume of which allows building additional financial and non-financial applications.

As a disadvantage of chip cards, one can single out their "slowness" when working with ATMs and pos-terminals, as well as the need to enter a pin code after each transaction, as a means of additional protection.

According to the method of exchange with readers, smart cards can be divided into

• Contactless
• Contact

In some cases, cards are used that include contact and contactless interfaces, which significantly expands the range of work of these cards.
Since there is a lack of infrastructure for the reception of purely microprocessor plastic, i.e. not all terminals and ATMs allow working with a smart card, the most common is a bank hybrid card.
Hybrid card - a card that contains both a chip and a magnetic stripe.