ELI5 Credit Card Security - is a chip really safer than a magstripe?

Why are the new chip and pin credit cards safer than the magnetic stripe, especially when most cards still have both? How is the 3 digit security code useful? What is credit card skimming and how does it work? Why does American Express have a different security code format to Visa and MasterCard?   ... We explain like i'm five!   Thank you to Empower, the sponsor of today's episode. For more info about Empower, visit: empower.me/ELI5     Thank you to the r/explainlikeimfive community as always and in particular the following users whose questions and comments formed the basis of this discussion: cleanaxe, hecre8ivewon, bringer_of_words, tehwildman, theapiary, longtimegonemtgo, ddacke, benthevining & wwwyzzrd. To the ELI5 community that has supported us so far, thanks for all your feedback and comments. Send us an e-mail: [email protected]