Still Haven’t Switched to EMV? Read This.
October 1, 2015, marked the official transition to EMV or “chip cards” when merchants would be liable for counterfeit and lost or stolen transactions if they had not yet adopted chip technology. Despite the financial responsibility of this decision, today many small business owners have still not made the switch. If you are among them, the first thing you should know is that EMV is a positive and simple change that will benefit your customers and your business. In this article, I’d like to facilitate your transition to EMV by demystifying this new technology and explaining why it’s a wise business decision.
The first thing you might wonder is why do I need EMV—what’s wrong with regular cards? Fraud, that’s what! There are over 1.2 billion cards in America and magnetic strip technology hasn’t changed much in 50 years. Meanwhile, however, fraudsters are becoming smarter and are finding ways to steal credit card data on a massive scale: for example, the 2013 Target hack where 40 million shoppers were affected.
The Target breach represented a much wider problem in the United States. A May 2015 report by Barclays found that 47 percent of the world’s card fraud happens in America, even though Americans account for only 24 percent of total credit card volume. Our disproportionate share of credit card fraud demonstrates the fact that magnetic strip technology is not keeping up with the advancements of hackers.
How Does EMV Work?
Other countries around the world have been using EMV technology for years and have experienced declines in credit card fraud. EMV stands for Europay, MasterCard, and Visa, and it is a joint effort among these companies to create a global standard for safer payments.
EMV is more secure because transactions are dynamically authenticated, verified and then authorized. The chip card generates a unique one-time code that makes it almost impossible for a hacker to access the account, reuse the code, or create a counterfeit card.
How Will EMV Benefit My Business?
EMV will benefit your business because payments will be safer. Consumers will have confidence that their transactions are safe, and their data is secure. Customers are starting to demand EMV terminals from large and small retailers alike, so you can boost customer satisfaction and confidence by making the switch.
Implementing chip technology will also protect you financially. The U.S. Fraud Liability Shift, which took effect on October 1, 2015, protects merchants who have adopted chip technology. Meanwhile, if fraud happens and you don’t have EMV terminals available, you are financially liable. A breach with the old technology could cost you your business.
Will My Customers Embrace EMV?
Research shows that consumer enthusiasm for chip cards is high. 80 percent of consumers expect chip card readers available at the merchants where they shop today. Using EMV terminals is as easy as non-EMV terminals, so the learning gap is small. Research shows that consumers are “very confident” in using a chip card, and they rate their experience of using an EMV terminal as very easy.
Making the switch to chip technology is simple – just upgrade your terminals to allow EMV cards to be processed securely in your store. With benefits like safer transactions, reduced liability, and increased consumer confidence, EMV adoption is a wise decision for small businesses.