We've been quite surprised how little press this issue has received. Even larger businesses that have made the investment in the new POS terminals are still swiping cards rather than using the EMV chips. This article contains basic information regarding upgrading to the new terminals and the shift in liability from the card issuer to the business.
On October 1, 2015, businesses of all sizes are required to have updated POS terminals and backend software to begin accepting EMV chip cards. If you haven't made the shift by October 1, your business, instead of the credit card company, becomes liable for incidents of credit card fraud.
The year of EMV migration is upon us and for U.S. SMBs that means significant changes when it comes to processing customer payments.
Have no idea what I mean by EMV? You're not alone. You've likely seen the tiny gold design on the front of many credit cards during transactions in recent months, but thought of it as more decorative than deliberate. Short for Europay, MasterCard, and Visa, EMV is a payments standard in which the designs — which are actually computer chips — are embedded into credit cards to create a unique impression.
EMV, which was part of an executive order President Obama issued to implement enhanced security measures for consumer finances, makes it near impossible to create fraudulent cards.
On October 1, 2015, businesses of all sizes are required to have updated POS terminals and backend software to begin accepting chip cards. The date isn't actually a deadline, it's the timeline for a liability shift. Simply put, if you haven't made the shift by October 1, your business, instead of the credit card company, becomes liable for incidents of credit card fraud.
Of course, SMBs who are always watching their bottom lines, are worried about the added cost of upgrading a POS system to be chip ready. While the switch will indeed require an up-front investment, it's more than worth it to prevent financial and/or legal trouble in the future. Still wondering why you shouldn't put off making the switch to chip? Here are three great reasons:
- Customer Trust — With data breaches on the rise, consumers are demanding better protection. That means they're expecting your business to be on par with the big guys when it comes to security. Investing in new technology is an easy way to showcase your business as reputable and worthy of a customer's time and attention. In fact, more than 90 percent of consumers said they would consider taking their business elsewhere rather than work with a company that uses outdated technology.
- Less risk of fraud — EMV chip cards use cryptograms that are unique to each transaction. The added layer of security provided by the chips makes debit and credit card data much less valuable, decreasing incentives for counterfeiters to steal cards and data.
- It's easy — Chip cards are easy for your customers to use. Once your chip card terminals are enabled, customers will insert their cards and follow the easy on-screen prompts, just as they would swipe readers.
Don't worry. Your old card reader won't turn into a pumpkin and suddenly become unusable after October 1. You'll still be able to swipe cards and process transactions as usual, but your business will be at higher risk. Small businesses often can't afford to take on this kind of liability and being ahead of the game will make your SMB appear even more trustworthy and appealing to customers new and old.
For more information on the switch to EMV, visit VisaChip.com.