Credit card fraud costs American companies and consumers billions of dollars each year. In an effort to reduce the rampant fraud in the credit card industry, EMV Chips (vs magnetic stripe technology) are becoming the standard for credit cards. Chip card transactions provide advanced security by making each transaction unique, and preventing anyone from skimming the credit card infomraiton and replicating it to commit fraud.
EMV is currently used in over 80 countries around the world and is now becoming the standard in the United States. This switch means several things for merchants and financial institutions. First, the switch to EMV means adding new in-store technology and internal processing systems. It also means a change in liability for credit card fraud. Pre October 1st, 2015, if an in-store transaction is conducted using a counterfeit, stolen or otherwise compromised card, consumer losses from that transaction generally fall back on the payment processor or issuing bank. Beginning on October 1st, 2015, a deadline set major U.S. credit card issuers including MasterCard, Visa, Discover and American Express, the liability for card-present fraud will shift to whichever party is the least EMV-compliant in certain fraudulent transactions.
This means that merchants will have to upgrade to a new terminal that accepts EMV chips or be forced to accept any costs incurred due to fraudulent charges on non-EMV cards. If you have any questions on how to make the change or are interested in purchasing an upgraded machine, call us at 1-800-440-9033 x31 to learn more about how to protect your business.