Technology’s constantly evolving for one reason or another. When it comes to technology in the payments industry, it’s usually for one of two reasons: security or convenience, sometimes both. When these changes take place, it’s generally a necessity for businesses to upgrade accordingly and avoid vulnerabilities or the stigma that comes with outdated technology. With a small business that’s highly susceptible to fraud activity, it’s important to take the proper steps to protect yourself and your customers. Recently, the United States made a pretty large transition to a technological development due to actual industry regulation. This change is known as the “EMV shift”. While this EMV technology isn’t necessarily new, and has been implemented in many other European and Asian countries before the U.S., the shift has been interesting for many businesses and consumers.
What is EMV?
EMV stands for Europay, Mastercard, Visa and was created to manage the standards for processing credit and debit card transactions by combatting fraud. The technology revolves around a very small computer chip that is embedded into the credit and debit cards people carry and use. These chips are very hard to counterfeit and when paired with another identity verification method like PIN or signature, make fraud extremely difficult to pull off.
What does the EMV shift in the U.S. entail?
As of October 1, 2015, the payment networks and banks in the U.S. implemented a “liability shift”. With the shift, banks and credit card companies began issuing new cards to consumers that have both a magnetic stripe and a chip. The shift requires that all businesses upgrade to POS terminals that facilitate the use of EMV chip cards. Without this technology, a merchant is to be held liable for any fraudulent purchases that occur when a card is swiped at their business. This is a major change for business owners, as the banks and payment networks were previously responsible for any chargebacks or fees associated with credit and debit card purchases.
Why now?
As unbelievable as it may sound; almost half of the world’s credit card fraud happens in the United States although only about a quarter of all credit card transactions happen here. With technology continuing to advance and the growing prevalence of security breaches (even at some of the country’s largest retailers), financial institutions were more motivated than ever to make a significant improvement. Because other countries have already seen positive results in fraud prevention with EMV, the shift to this technology just made sense.
How should I prepare in my store?
Because the liability deadline has already passed, it’s important that you act quickly. The first step to making sure your store is equipped and ready for the EMV shift, is upgrading your credit and debit card processing terminals. By simply ensuring that your terminal is ready to process EMV chip cards, you’re guaranteeing that you won’t be left paying for the actions of a fraudster who swiped a stolen card at your store. If your business is also a gas station, you’ll need to make sure your gas pumps are going to be updated as well. This upgrade has a deadline of October 2017, so you’ll have some time to make the switch at the pump. Although it may seem that the cost of updating the technology at your business is too much, taking advantage of this time to upgrade will turn out to be a great investment in the long term.
How will EMV benefit my business?
Besides just maintaining compliance with payment industry standards and saving money on potential fines, making the EMV switch will have a number of positive effects on your business. Because the official shift has already passed and consumers have had their chip cards for some time now, they are growing more comfortable with the EMV technology. As people become more accustomed to inserting their card into POS terminals and they become more aware of the security hazards with swiping, they will start to view businesses that are not EMV-ready as less trustworthy. Having a good reputation for protecting your customers and being equipped with the latest technology is a great way to attract and retain customers.
Having EMV capable payment processing equipment also adds convenience to your checkout process. Once you’ve upgraded your terminals, you’ll find that the EMV transactions are actually completed much faster than those that happen by magnetic stripe. Also, you have the luxury of resting assured that data will be transmitted is much more secure. Your customers will enjoy not only confidence, but the ease with which they can process payments, as most EMV capable terminals also come equipped to accept contactless payments (Apple pay™ and Samsung pay).
If you’re looking for more information on the EMV liability shift or what it means for your business, you can check out this site designed specifically for c-store owners:
If you still need to upgrade your terminals and want more information on goEBT’s new EMV-ready single-terminal solution through our partnership with TSYS?
