Effective October 1, 2015, magstripe counterfeit fraud liability shifts to merchants that are delinquent in implementing EMV.
You’ve heard that changes are coming in the credit card industry. You may have even heard the term EMV, and more than likely a date of October 1, 2015 to become EMV compliant. And, as with any change that involves how our customers pay, EMV has become a pretty hot topic. We’ve heard you have a lot of questions and many of you are seeking answers. That’s why we’re here – Redstone is dedicated to not only processing your merchant fees but also ensuring that you are able to make informed decisions about matters that are important to protect you, and your customers.
We know there’s a lot of data to sift through and because any EMV card discussion usually mentions “fraud” and “liability,” it’s natural that it could put small to medium sized business owners on edge. So .. let us break it down for you.
What exactly is all the buzz about?
U.S. banks are adding a chip to our credit cards and they’re calling what the chip does “EMV technology”. EMV stands for “Europay, MasterCard and Visa,” and this technology has been implemented in several other countries. In fact, we’re one of the last to still be using magstripe technology.
What is EMV technology?
EMV technology involves imbedding a tiny computer chip into a credit card which is extremely hard to counterfeit. If you’ve gotten a card recently, chances are it’s embedded with a chip that houses this robust technology.
So why is the industry moving towards using EMV technology?
Many of you may not know that almost half of the world’s credit card fraud now happens in the United States – even though only a quarter of all credit card transactions happen here. Banks are counteracting this statistic by steering the industry away from traditional magnetic-stripe cards which, as most of you know, are much easier to counterfeit. Due to the many recent high-profile security breaches, banks are moving quickly to implement this additional layer of security to assist with mitigation of the credit card fraud that is now rampant across the United States. This enables us to follow the same path as Europe, and allows for a worldwide standard for addressing fraudulent transactions.
How are chip transactions different?
Instead of the swiping your customer’s card through a terminal or waving the card in front of a device, the customer retains possession of the card, and inserts it in the EMV slot. We call this ‘chip and dip’ as the card stays in the reader until the transaction is complete. For contactless transactions, the consumer experience will not change.
How do I know what modifications I’ll need?
We will help you. If you process using a standalone POS terminal, we’ll contact you to load new software to your device or speak with you about terminal and peripheral upgrade requirements. Standalone POS terminals that cannot support EMV will no longer be supported for downloads beginning on the liability shift date. You may require an equipment upgrade. If that is the case, we can work with making your transition as cost effective and painless as possible.
Why is EMV important NOW?
Protect your business from credit card liability.
A primary way cybercriminals use stolen credentials is to create a false card to impersonate the actual card. As criminals recognize EMV implementation is underway, they tend to increase fraudulent activity. They’ll ramp up using what they know – magnetic strip technology. Don’t take the chance of the liability falling on your business by not upgrading your equipment.
Reduce your costs of fraud.
Businesses still using magnetic stripe terminals after October 1, 2015, are on the hook for the costs if someone uses a lost or stolen credit card, not the banks.
Show your customers you care.
EMV is the future of payment transactions. Show your customers that you are concerned about the security of their data by implementing an EMV capable system.