One of the most talked about changes in the world of payment acceptance this year will be the liability shift that goes into effect October 1, 2015. To provide enhanced payment card data security, the major card brands have been pushing for widespread EMV adoption in this country for years. Shifting the liability for acceptance of counterfeit card transactions is one of the big milestones on the path to EMV adoption.
EMV adoption entails moving away from the traditional swipe payment cards to new smart/chip cards or EMV (Europay, MasterCard®, Visa®) cards.
Smart/chip cards work by using chip technology. Instead of consumers swiping a credit card as they do today, consumers will use a chip enabled card, which stores all the credit card’s data in a tiny computer chip within the card. The payment terminals read the chip to ensure that the card is valid. These cards provide more security than current swipe cards since the data is dynamically encrypted and unique for each purchase.
During an EMV transaction the card never leaves the card-holder’s hand, not even in a restaurant environment. The card stays in the terminal until the transaction is completed by the consumer either by entering a four digit pin, signing, or in some cases the card issuer will verify by the chip alone.
Why the Change?
Let’s look at a few statistics from Business Insider.
- $7 BILLION: The cost of Credit and Debit card fraud related losses in the United States in 2013
- 51%: The amount of global credit card fraud attributed to the United States in 2013.
What do you need to know?
The liability shift will be effective for fraudulent card present losses which could have been detected through the EMV cards and terminals. This means after October 1, 2015 if your business accepts and processes a counterfeit card transaction on a non-EMV terminal, which would have been detected with an EMV terminal, the liability for that transaction is yours, not the card issuers’.
In order to protect your business from potential card fraud liability, you will need an upgraded EMV enabled terminal solution.
While card issuers across the US continue to replace the traditional magnetic strip cards, the EMV terminals will still support the legacy cards through the transition. In addition, many EMV terminals are also NFC enabled which enables mobile wallet payments such as Apple Pay ™, Visa PayWave®, MasterCard Pay Pass™ and American Express® ExpressPay.
This means there is a new, secure way for your customers to pay for their purchases and another way for you to securely accept payments.
To be prepared for this change, please check to see if your current terminal is EMV enabled.
Terminals with this technology include:
|VX520 Countertop terminal||iCT250 Countertop terminal|
|VX680 3G GPRS Long range wireless||iCt220 Countertop terminal|
|VX680 Bluetooth Short range wireless||iWL250G GPRS Long range wireless|
|VX820 External PIN Pad||iWL220B Bluetooth Short range wireless|
|iPP320 External PIN Pad|