Most credit cards now give you three ways to pay in a store: swipe the magnetic stripe, insert the EMV chip, or tap the card (or your phone) on the reader. The chip and tap methods are newer and more secure than swiping. Here’s how each one works and why the difference matters for your safety.
How the EMV chip works
EMV stands for Europay, Mastercard, and Visa — the companies that created the standard. When you insert (“dip”) your card, the chip generates a unique, one-time code for that single transaction.
Because the code can’t be reused, a thief who somehow copies it can’t use it for a second purchase. That’s a big improvement over the old magnetic stripe, which stores the same fixed data every time and is easy to clone.
How tap-to-pay (contactless) works
Tap-to-pay uses the same chip technology, but instead of inserting the card, you hold it within an inch or two of the reader. The card and reader communicate over a short-range wireless signal called NFC (near-field communication).
Like the chip, each tap creates a one-time code, so it’s just as secure as dipping. It’s also faster, and because nothing is inserted or swiped, there’s less wear on the card and no chance of leaving it behind in the machine.
Why both beat the magnetic stripe
The magnetic stripe is the black band on the back of your card. It stores static data, which means the same information is transmitted on every swipe. That’s exactly what card skimmers are built to steal and copy.
Chip and tap both replace that static data with a fresh, single-use code each time. That’s why card issuers and stores have pushed customers toward chip and contactless, and why you should prefer them whenever a reader supports them.
When to use which
Use tap-to-pay when the reader shows the contactless symbol (it looks like a sideways Wi-Fi icon) — it’s the fastest option. If tap isn’t available or doesn’t register, insert the chip instead.
Save the magnetic stripe for the rare cases where neither chip nor tap works. And if a card reader looks loose, bulky, or tampered with, it’s safer to pay a different way or at a different terminal.
Frequently asked questions
Is tap-to-pay less secure than inserting the chip?
No. Tap-to-pay uses the same chip technology and generates a unique one-time code for each transaction, so it is just as secure as inserting the chip.
Can someone steal my card info by standing near me?
It is extremely unlikely. Contactless readers only work within an inch or two, and each tap produces a single-use code that can’t be reused, so a captured signal is worthless.
Why do some stores still make me swipe?
Some older card readers haven’t been upgraded to accept chip or tap. When that happens, swiping is your only option — but prefer chip or tap wherever they’re available.
By O.B., Founder · Last reviewed June 3, 2026
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This article is general education, not personalized financial advice. Card terms, fees, and benefits are set by the issuer and can change — always confirm details on your official card terms.