Credit cards all across the United States are now being issued with a small computer chip embedded in the card. This is called the EMV (Europay, MasterCard and Visa) chip, and it is the new standard for card payment. Business owners are unsure about adopting this technology as they weigh the advantages and disadvantages of making their POS systems EMV-capable. Here’s what you should know about EMV chip technology.
What did the October 1st deadline mean for merchants?
As of October 1, 2015, the liability shift went into effect. This means that merchants who don’t have the ability to process EMV payments might be held responsible for fraudulent transactions made with cards that contain a smart chip (EMV chip). If a cardholder chooses not to use the technology or has a card that lacks an EMV chip, the merchant will not be held responsible for any fraud that comes as a result of this.
Does this mean an end to credit card fraud?
Not entirely. EMV, in theory, will reduce instances of credit card fraud in the United States for several reasons. The chip reads out a unique transaction code each time it is used, whereas magnetic stripe cards issue the same transaction code each time. Also, magnetic stripe cards are much easier to counterfeit than EMV chip cards. However, when it comes to transactions where the card is not presented (such as online transactions), EMV offers no additional protection to the cardholder from fraudulent purchases.
Do I need to be EMV-capable?
Though it is a good idea to have the technology to accept EMV transactions in order to avoid fraud liability, it is not a necessity. Businesses can continue to do business as usual with magnetic stripe readers, and many of them will. Card companies in the United States are continuing to issue cards with both magnetic stripes and EMV chips; even if you specially request one with an EMV chip only, the card company will explain to you they cannot issue it this way.
What do I need if I choose to be EMV-capable?
To be EMV-capable, you are first going to need to make sure your POS can accept EMV chip cards. If yours doesn’t already, you will need to contact a local POS reseller to upgrade. Seeking the services of an experienced POS provider is the best route to take for this transition. They can give you the run-down on what you are going to need as far as hardware and software and can offer you bundled packages for your business so that you are EMV-capable.
How do I educate employees?
Once you’ve implemented your new EMV-capable system, you will need to do hands-on training with your cashiers on the new technology. You should also go through role-playing scenarios on how to process the payments. Employees should be ready to answer customer questions about how to use the device as well as the security advantages of the new technology.
Additionally, more and more cardholders will be using mobile payment technologies, using their smart phones to make payments. EMV-capable systems generally have NFC mobile payment built in. Therefore, cashiers and floor employees should have hands-on training with this as well to be sure cardholders are taken care of.
Retail environments are targeted daily by credit card fraudsters and hackers. With the liability shift, now is the time to choose whether or not to implement EMV technology in your store or restaurant. However, if you do not, you might consider the fact you could potentially be stuck footing the bill for these fraudulent charges when you could have invested the money in new POS devices.
