Starting Oct. 1, 2015, your business’s bottom line could be at risk.
A new standard is being imposed on all merchants that run in-person credit card transactions. It’s known as EMV. At the end of this month, the EMV liability shift goes into effect. Once this shift happens, the financial consequences of credit card fraud move from the major credit card brands to merchants.
If you still don’t have all the facts about EMV and your business is not prepared, learn the three actions you must take to be ready for the EMV liability shift.
#1. Understand What The EMV Liability Shift Means For Your Business
EMV is a payment technology standard initially created by EuroPay, MasterCard and Visa. It was developed to cut down on credit card fraud. Under the standard, magnetic swipe cards get replaced by chip and pin credit cards. These new cards have a microprocessor chip that generates a unique digital signature that verifies transactions come from customers’ actual credit cards and that the chip inside has not been altered.
Worldwide adoption of this technology has varied and the U.S. is the last major financial market to get on board. To encourage adoption among U.S.-based issuing banks and merchants, the major card brands initiated the EMV liability shift. Previously, card brands typically accepted the liability for fraudulent credit card transactions authorized at brick-and-mortar merchant locations. Once the shift goes into effect, either card-issuing banks or merchants are going to be responsible for the costs of fraud.
The liability is determined by which party has not adapted to the chip and pin credit card payment technology. If a merchant has acquired the necessary technology, but a card-issuing bank is still issuing swipe cards, then the bank is responsible. However, if a merchant has not acquired the necessary technology, then they are held responsible, no matter what the bank has done.
No matter the size of your average credit card transaction, you don’t want to have to cover the costs of fraudulent transactions.
#2. Survey Your Payment Technology
To be ready for the EMV liability shift, you need to have the right technology. If your credit card machine or POS terminal is several years old or acquired at the lowest possible cost, it likely does not accept chip and pin credit cards. In other words, you are not prepared for the EMV liability shift and, until you acquire the right technology, are going to be held responsible for all fraudulent transactions processed at your business. State-of-the-art POS terminals are able to accept these cards and offer your business many other benefits including inventory control and revenue tracking that make managing your business easier.
Look over your credit card machines and POS terminals to see if they are able to accept chip and pin credit cards. If they are not, it’s time to upgrade.
#3. Call Your Merchant Services Provider
The EMV liability shift is imminent and you need to act fast. To comply with the new requirements, you should call your merchant services or payment processing provider. If your provider is as dedicated to your bottom line as you are, then they should help you come up with a plan to get compliant ASAP. They should also be able to answer any additional questions you may have about EMV and the right payment technology for your business.
If your merchant services or credit card processing provider is hard to reach or reluctant to help you with your EMV compliance plan, then it is likely time for you to upgrade your provider as well.
With the EMV liability shift happening so soon, you need to take action and become EMV compliant as soon as possible. Take the actions above to get started.
Are you concerned that your merchant services or credit card processing provider is the wrong fit for your needs? Download our free payment processing tip sheet to find out if you’re working with the right provider for your business.