Nick Essame, Head of Technology at Visa International, says, “A smart card is like a mini-computer. It has a microchip embedded in it that holds enough information to correctly identify you.”

One of the biggest changes you will need to get used to with a smart card is that it is PIN operated. Signing on the dotted line will no longer be a part of the process.

Swipe and sign gone

“…[T]his is a similar procedure to when you use your debit card. Smart cards are inserted into readers and the information is processed and either approved or rejected. Gone are the days of ‘swipe and sign’, smart cards represent an era of ‘chip and pin’ ,” he says.

The new system will ensure that your card is always in your possession. For example, at a restaurant, when previously paying with your credit card, a waiter would take your card away from you to complete a transaction.

This is one of the times that your card is most vulnerable to fraud. With the new system in place, waiters will be obliged to bring the card-reading device to your table in order for you to tap in your secret PIN. “This will make it a lot more difficult for fraudsters to copy your card and use it for their own personal gain.”

Brings down fraud

The main reason for the creation of the smart card is to counteract high levels of fraud from counterfeit and lost or stolen cards.

“The smart card has proven to bring down levels of fraud in all the countries in which it already operates. The introduction of the cards will definitely have a positive impact on the South African market,” Essame said.

As long as you keep your PIN number a secret, your smart card will be safe from criminals who will be unable to use it unless they crack your secret code: a highly unlikely possibility.