In October of 2015, EMV will become a reality for those individuals involved in the process of accepting credit cards. While Visa, Mastercard, Discover, and American Express, each has their own unique description for the changes in liability, beginning in October 2015 when a fraudulent transaction occurs, liability for any resulting counterfeit losses will fall on whichever part of the chain is responsible for the EMV transaction not occurring.
If your business is not EMV ready, now is the time to begin developing and implementing your EMV roadmap. Learn more about EMV, the liability shift, and your responsibilities in our latest infographic below.
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Are You Ready for October 2015?
The deadline is fast approaching for businesses to transition to EMV card technology.
What is EMV?
EMV cards contain a chip, in addition to the traditional magnetic strip, that is used to transmit data. Unlike standard magnetic card, EMV cards create a unique transaction code every time they are used. Each code can only be used once, making fraud more difficult and less likely to occur.
What is the Purpose of EMV?
Create Universal Standards
- EMV has been around since 1992
- U.S. is one of the last to adopt the card technology
- Makes traveling and doing business overseas easier
- U.S reported $11 billion in credit card fraud in 2013 (Almost half of the world’s credit card fraud)
- EMV can help protect both consumers and businesses
- Fraud losses for brick and mortar retailers dropped 60% in the UK after adopting EMV technology
How to Process EMV Transactions
EMV is a card-present technology that can be processed several ways.
Those individuals with NFC enabled cards (dual mode) can tap the card in front of a NFC enabled POS device and then provide either a PIN or signature.
Chip & Pin
Insert the card into a POS device which keeps the card until a PIN number is provided. (Most used worldwide)
Chip & Signature
Instead of providing a PIN to complete a purchase, this process just requires a signature. (Most likely to be implemented in the U.S.)
If a transaction is under a specific floor limit, neither PIN nor signature may be required.
Understanding the Fraud Liability Shift
Mark Your Calendar for October 2015
While each card payment brand (Visa/Mastercard/Discover/American Express) has their own unique description for the changes in liability, all agree that beginning in October 2015 when a fraudulent transaction occurs, whichever party (Merchant/Processor/Card Issuer) is the cause of the contact chip transaction not occurring will be held financially liable for any resulting card present counterfeit losses.
The Card Issuing banks are responsible for ensuring that the cardholder has been sent an EMV enabled credit card; failure to do so will result in the card issuer being held responsible
By the end of 2015, an estimated 70% of credit cards and 40% of debit cards in the U.S. will support EMV
Preparing Your Business for EMV
When it comes to preparing your business for EMV adoption and standarization, the countdown is on.
As a retailer, your first order of business should be the development of a detailed, time-sensitive EMV roadmap.
Use it to outline the steps you’ll take to be in compliance by the time October 2015 rolls around.
By having everything upgraded and ready to go ahead of time, your business will be prepared to meet the requirements and ensure that you are not held liable for fraudulent transactions.
To learn more about developing an EMV roadmap for your business, contact your merchant service provider.