By

This week, Bank of America announced that it's starting to issue consumer credit cards that contain EMV chip technology. The cards will offer increased security to cardholders, and people who travel abroad will be able to use them in more locations.

EMV stands for Europay MasterCard Visa (EMVCo), and it's a chip-based payment card. The credit card contains a microchip operating system that encrypts and stores account information. According to the Smart Card Alliance (SCA), because the credit card issuers use specific keys when issuing an EMV card, it's almost impossible to counterfeit, making this type of card safer than the standard magnetic stripe card that's readily used throughout the United States.

The SCA notes that eighty countries around the world, including Canada and many countries in Europe, Asia and Latin America, have already adopted EMV technology or are in the process of migrating to it. EMVCo. says that at the end of 2011, about 1.5 billion EMV cards had already been issued, which is nearly half of all cards in circulation. Over 21.9 million point-of-sale terminals around the world accept this technology, which, not counting locations in the U.S., means that over three-quarters of these terminals are prepared to accept chip payments.

Over the last year, credit card networks and issuers in the U.S. have also laid out their plans to introduce the technology here.

Bank of America customers may not notice much difference in transferring to the new card, as the bank will still require customers to sign for transactions. The cards will also have the traditional magnetic stripes, which is universally used in the U.S.

"The new chip-enabled cards will improve convenience and security of customers' transactions when traveling abroad," said consumer and small business products executive Susan Faulkner in a statement. "We want our customers to have the best possible experience while making purchases with their credit cards anywhere in the world."

The bank will start issuing chip-based cards for many of its brands. Newly issued cards for Merrill Lynch credit cards, U.S. Trust Accolades, BankAmericard Travel Rewards, BankAmericard Privileges and Virgin Atlantic travel credit cards will all come with the chip technology. Bank of America will also send chip-based cards to these programs' cardholders who have been identified as international travelers.

Many of Bank of America's other credit cards will offer the EMV chip as an optional feature, and cardholders in these programs may request the new card: BankAmericard Cash Rewards, BankAmericard Power Rewards, BankAmericard, AAA Members Rewards, NEA, Asiana Airlines, Alaska Airlines, Royal Caribbean and Norwegian Cruise Lines. Cardholders in these programs may ask for chip card options at the banking center or by calling the bank. Later this year, they will be able to make requests online.

While this rollout of EMV chip cards will still require customers to sign for their transactions, there are a total of three ways EMV cards can verify the cardholder for purchases. Along with the signature method, there is the online PIN, where the card issuer encrypts and verifies a user's PIN online; the offline PIN is similar, but the verification is handled offline by the EMV card. Additionally, customers can use an EMV card without card verification. This typically happens when a purchase has a low value or is made at an unattended point-of-sale location, such as a parking garage.

Other credit card issuers are rolling out EMV chip technology on some of their cards too. JPMorgan Chase offers it on four of their cards, including the JPMorgan Palladium Card and the Chase British Airways Visa Signature Credit Card. Citibank also offers it on its Citi Executive/Aadvantage World Elite MasterCard.