Three things to know about the new EMV chip cards



The payment card with the little chip on the front is becoming more common. EMV chip cards are here to stay, but many merchants and consumers aren’t sure what they mean to them. Business owners have probably received notifications from their payment processor about the importance of upgrading to an EMV enabled terminal, and many have already done so. Whether or not you have made the switch or are still considering it, here are three things to know about EMV chip card technology.

1) EMV chip cards are more secure
The threat of credit card fraud has increased in recent years, and is something on the minds of both merchants and consumers. In addition to headaches and wasted time, identity theft resulting from a data breach results in increased financial burdens to merchants. A common scenario is when hackers use stolen card data to create fraudulent cards, and either use them or sell them to be used by others. The potential revenue loss is huge, particularly as the fraudulent charges continue downstream.

In the past, most of the loss liability due to fraudulent payment cards has been levied on the card issuers. This changed on October 1, 2015, when liability for fraudulent charges made at the physical point-of-sale shifted to the “least secure” party in the transaction. Merchants that do not accept EMV chip cards using a chip card-ready terminals could be held liable for any fraud resulting from the transaction. If your customers present a chip card for payment, and you ask them to swipe the card instead, you could be at risk.

EMV-enabled credit card terminals help secure transactions using an embedded microchip in the card. Chip cards are more difficult, if not impossible, to duplicate. Considering that a large degree of data theft occurs by thieves using counterfeit cards, chip cards go a long way to stopping this from happening.

Upgrading to EMV enabled chip card technology helps reduce your liability for fraudulent card-present purchases. Upgrading is not only good for business, it offers peace of mind that you are taking proactive steps to protect your customers and your business.

2) More EMV chip cards are in circulation in America
It wasn’t too long ago that less than half of people had an EMV chip card in their wallet– but this number is growing. More financial institutions are rolling out chip-enabled credit and debit cards to their customers, which means merchants will see more chip cards presented for payment. If you do not have an EMV enabled terminal, and accept payment from someone using a traditional magnetic strip card, you won’t be held liable for fraud. However, if accept a payment with a chip-enabled card without using an EMV enabled terminal, and instead swipe the card, you risk the chance that you could be held responsible for any claim of fraud associated with that transaction. This is an important consideration as you determine when and how you will implement EMV enabled chip card technology for your business.

3) Dip, not swipe
One of the biggest differences with EMV chip cards compared to traditional payment cards is in how they are used in transactions. EMV chip cards are “dipped,” or inserted into the terminal, versus swiped. An EMV chip card must remain inserted in the terminal for the entire authorization and approval process, which makes the transaction typically a little longer to complete than swiping a traditional payment care.

Busy merchants know that the last thing they want is a long line at checkout, and even 15 seconds longer to complete a transaction can seem like hours. So, you should expect some impatience both from customers who are using their chip cards for the first time, and from others waiting in line behind them.

Additionally, some EMV chip cards are PIN-enabled, which is another new step for consumers to become accustomed to. As a merchant, what can you do to help ease the transition to a new way to pay? The most important things you can do is train your staff to help your customers learn how to use their cards, and let them know that these cards have a positive impact on the overall security of the transaction.

Consumers care about convenience, but they also understand how much more inconvenient it will be to be the victim of a security breach than to wait a few extra seconds for a more secure EMV transaction to complete. One option you have to speed up transaction time is to upgrade to an EMV enabled terminal or POS that has a Tap-and-Pay feature that allows mobile payments. Both Apple and Android mobile wallets allow payment by automatically deducting from an associated credit, debit or charge card, and are reinforced by strong encryption to protect users.

EMV means different things to different merchants, and is not mandatory for doing business today. But being aware of your options can help you make the best decision about when and how to implement EMV for your business. In the meantime, you should keep data security top of mind, and take the necessary steps to protect your customers’ and your business’ sensitive information. Your trusted payment processor can be invaluable in your efforts to reinforce data security for your business, and can be a good source of information about your EMV options.



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