It's the beginning of the end for swipe-and-sign card payments. 

Over the past year, many credit card issuers have updated their customers' magnetic-stripe-only card with those that have both the stripe and what's known as an EMV chip. (EMV stands for the three companies that came up with the standard: Europay, MasterCard, and Visa.) Now, starting in October, the liability for fraudulent credit card transactions will shift from the credit card issuer to whichever party—the credit card issuer or the merchant—is using the least secure technology.

For consumers, the rollout will be gradual as merchants begin using new card readers. Instead of swiping your card through a card reader at the cashier (so it can read the data on the card’s magnetic stripe), you’ll insert it until the transaction is complete.

The card reader will then communicate with the chip inside your card using cryptographic algorithms to authenticate the card. The benefit is that because the data is housed on the chip, it will be much harder for thieves to replicate than it was when it was stored on the magnetic stripe.

For years, the U.S. had been behind most other nations in card-payment technology. Most other countries have long used chip-and-pin technology, requiring the user to insert the credit card into a reader, and then enter a personal Identification number. (Indeed, it's a process that's long frustrated some Americans when traveling abroad). 

Meanwhile, American cardholders have still been using a decades-old magnetic-stripe-card technology to make credit and debit purchases. The data stored on these magnetic stripes are unencrypted, easily counterfeited by skimming devices, and have cost credit card issuers—who until now usually bore the cost of the fraudulent transactions—billions of dollars annually.

Using an EMV credit card at checkout. New credit card technology rules begin in October.

The expectation is that the new chip will help reduce fraud. But when there is fraud, it may be the merchant that is liable since many haven't yet upgraded their card-reading machines to read the new EMV chips.

One thing to realize, though, is that just because your card has an embedded EMV chip doesn't mean its necessarily using true chip-and-pin technology. Many U.S. issued credit cards will instead use what is known as "chip-and signature" technology. So even though you will dip your EMV-ready card into a new card reader, you'll still need to sign for purchases, instead of entering a PIN—a less secure process.

Unfortunately, even true chip-and-pin transactions can't guard against other types of credit card fraud. According to one industry forecast, online transaction fraud is expected to double over the next three years