Merchant Services

Chip cards go by many names, including smartcards and smart cards. No matter what they are called, chip cards provide an enhanced security benefit to consumers and retailers that's sure to change the way consumers manage spending.

The powerful microchip embedded in a credit or debit card is capable of storing data that is difficult to copy or change, thereby providing you with greater security against fraud and assistance in reducing unauthorized transactions, chargebacks and disputes.

At the same time, you can provide your customers with a consistent transaction experience whether they pay using a credit or debit card.

How To Process A Chip Card Transaction

A chip card reader, sometimes called a smartcard or smart card reader, looks and works like the debit card terminals most Canadians are familiar with today.

A cardholder simply inserts their chip credit or debit card into a chip-enabled terminal and confirms the transaction amount. When prompted by the terminal, the cardholder enters their confidential Personal Identification Number (PIN) on a keypad to verify their identity

When the correct PIN is entered, the chip card and the reader recognize each other, and validation occurs. The card remains in the terminal until the transaction is complete.

Both credit and debit card payments can be made using the same PIN keypad, providing a more consistent and simplified experience for the customer.

Some Visa* chip cards may still require a signature instead of a PIN - the terminal automatically recognizes when a signature is required from the customer. Simply follow the terminal prompts to process the transaction correctly.

Chip Technology Features and Benefits

• Faster processing

• – Increase your customers' checkout speed at point-of-sale - entering a PIN is faster than a signature for credit cards

  – You and your staff no longer have to worry about authenticating a cardholder's signature by comparing it to the signature on the card. (If the chip card transaction does require a signature, the terminal will prompt you for one.)

  – A chip card is easier to handle than a magnetic stripe device that requires swiping and signature - customers simply insert their chip card into the terminal and follow the prompts

• Reduced fraud

• – Your new chip-enabled terminal provides superior security which assists you in combatting fraud

  – You can help reduce various types of counterfeiting, as purchases cannot be made without your customer knowing their PIN, and data on the chip is very difficult to copy or change - which means chip cards can help reduce unauthorized card transactions, chargebacks and disputes

• Reduced costs

• – The PIN authenticates cardholders quickly, eliminating the need to store paper receipts and thereby reducing your administrative costs and record retention requirements

• Improved customer service

• – Your customers will appreciate quicker, easier checkout and payment flexibility

  – They will enjoy the convenience of a consistent payment experience for both credit and debit cards

Industry Information

To help you learn more about the potential of chip technology, we invite you to begin your journey here:

• Important information about chip cards(PDF)
• Canada is getting ready for the chip card(PDF)

To open a Merchant Services account, apply now or visit your local TD Canada Trust Branch.