I had my dog chipped a few months back. It caused him no discomfort as he was so excited to be around the vet and never even noticed the dagger being plunged into his shoulder blade area. :)
The last time I visited the breeder I got Kalil from, she was chipping all of her dogs that day as I believe it's the law in Iowa now for breeders. At least that's what she said. Or maybe it was some other law/rule and wasn't paying attention.