How does EMV work in my retail store
By now, you’ve surely heard of EMV chip cards and the US adoption of this payments technology. EMV—which stands for Europay, MasterCard and Visa—is a set of specifications for smart card payments and acceptance devices. EMV technology was adopted in Europe several years ago but the US has only ramped up adoption since 2015. Let’s take a look at how EMV works in retail stores.
Getting the right equipment to accept EMV chip cards
Accepting a new payment format means having to upgrade your systems to accept that format. In the case of EMV acceptance, you’ll need new terminals that allow customers to “dip” their cards to complete the transaction. The customer will insert his or her card into the payments terminal, leaving it there for the duration of the transaction—during which time unique transaction data is created and transmitted that is only valid with that single transaction.
Another important aspect of the rollout of EMV is education. Your staff and your customers alike must understand how to use EMV terminals. Spend time training your staff in how the new terminals work and make sure they are requiring customers with chip cards to use the “dip” feature of the terminals to make sure they’re processing transactions in the most secure way possible.
Benefits of EMV chip cards for retail
The major benefit of EMV technology is the reduction in card-present fraud that results from criminals using counterfeit, lost or stolen cards. It’s important to understand, however, that EMV also means a liability shift for certain types of fraudulent transactions from banks to merchants. If a merchant doesn’t have EMV-enabled equipment and systems in place and such a transaction hits the business, the merchant will probably be liable. Avoid liability for losses and potential fines by making sure your terminals are EMV-enabled and your systems are ready to securely transmit and store EMV transaction data.
EMV chip card technology secures the transaction with enhanced functionality in three main ways:
- Card authentication – EMV protects against counterfeit cards by creating unique transaction data so that any data that fraudsters may intercept could not be used in subsequent transactions.
- Cardholder verification – EMV authenticates the cardholder and protects against lost and stolen cards by ensuring the person making the transaction is the legitimate cardholder. Usually, EMV requires the customer enter a pre-set PIN before the transaction will initiate.
- Transaction authorization – EMV authorizes transactions using issuer-defined rules either online or offline.
Even though upgrading your retail store to EMV-enabled terminals will require an upfront investment, the benefits are enhanced security and peace-of-mind knowing that your business won’t be stuck with hefty fees in the event of certain types of data breaches that could have been avoided with EMV technology. For more information on EMV payment processing and what your responsibilities are, check out the EMVCo website.