As retailers in Hawaii and across the nation prepare to switch to "chip card" technology on Oct. 1, the biggest change is who’s held liable for fraudulent charges. Under the new system known as EMV, merchants who don’t have the proper card reader will be responsible for any phony charges made with counterfeit cards.

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"In the last year we’ve spent a lot of time on this going through it with our merchants to make sure they understand the liability shift and making sure that they're getting their equipment up to date and up to speed," said Anthony DeSanctis, senior vice president of credit cards for Bank of Hawaii.

However, don’t expect a big bang as the country crosses the deadline next week. That’s because not all banks are issuing the new chip cards right away. According to CreditCards.com, 120 million Americans have received the new cards, with another 480 million cards expected to be issued by the end of the year.

“It’s a big number,” said DeSanctis. “There’s not a plastics production company out there right now that isn’t fully operating 24/7.”  

The new cards feature the traditional magnetic stripe, but also contain a computer chip to help deter fraud. The chip allows the card to create a unique transaction number with each purchase.

“It’s less likely to pass the entire credit card information, so it’s much more secure in terms of passing the data,” said DeSanctis.  

Still, not all businesses will have the proper card readers on hand by the deadline. The Baker Dudes in downtown Honolulu will be punching in credit card numbers just to be sure.    

“We'll be looking at people's ID's a lot more (and) we'll have to definitely check up on handling fraudulent charges, we don't want those to happen," said co-owner Chris Rickett.

For those that have already received their chip cards, merchants without the proper card readers should still log any transaction. The technology requires customers to dip their cards instead of swiping, but the new terminals should come with instructions.

"So, it takes a little bit longer, but while they're bagging your groceries or whatever, you're waiting for them to finish anyways," said DeSanctis.

The Retail Merchants of Hawaii is holding a presentation about the new cards on Oct. 21 at the Ward Warehouse Kakaako Ballroom. The event is scheduled from 8 a.m. to 9 a.m. and is free of charge, but registration is required. To find out more, email the association at: retailmerchantsofhawaii@rmhawaii.org.

CreditCards.com also has a question and answer sheet that you can find by clicking here: 8 FAQs about EMV credit cards