In addition to the visible data (the card number, the expiration, and the CVV), there is other information encoded on the stripe that you cannot see (its called Track 2 data).

A swiped transaction will include the Track 2 data, but a keyed one will not. The Track 2 data proves that a physical card was present, which carries a far lower risk of fraud, and thus grants a lower processing rate.

Notably, in the recent Target breach, the Track 2 data was stolen as well. This means the thieves could print up real, swipeable cards.