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Are You EMV Ready?

This week marks a turning point in the history of payment processing in America. The requirement that all retailers and businesses be able to process EMV chipped cards is here, and along with it an EMV liability shift from credit card company to merchant. Previously, if a consumer’s credit card information was compromised, the card issuer was financially responsible for the breach. But now if a consumer’s card information is stolen, the merchant where the breach took place is responsible if they did not provide EMV processing.  This means thousands or even millions of dollars in compensation to consumers will come straight out of the merchant’s pocket.

EMV cards (created by Europay, Visa and Matercard) have a processing chip. This chip reduces the risk of fraud via a unique code for every transaction. Unlike the magnetic strips of regular debit and credit cards, this data is much harder for criminals to duplicate or track

Still many merchants don’t seem to be too concerned about the liability shift. According to a recent survey of 600 U.S. businesses, only 32 percent knew of the Europay, MasterCard and Visa (EMV) rules. Of the businesses that knew about EMV, less than 30 percent planned to upgrade their equipment by the October deadline. Why are so many merchants opting out of EMV conversion? Many argue that they simply don’t need to invest in new payment terminals as they’ve only had a few fraudulent incidences in the entire history of their company. So they don’t want to spend the money or provide the training that updating systems could require.

But merchants that have upgraded believe the investment could potentially save them large sums of money in the future, and is the best insurance against the new liability rules. Merchants who only utilize the magnetic terminals are almost guaranteed a breach at some time. The U.S. accounts for over 50% of the world’s credit/debit card fraud. The losses come to an estimated $6.8 billion for 2013.

If you are a small business, especially in a high risk market, make sure that your POS systems are compliant. If your business experiences a large security breach, not being EMV compliant could destroy your company. That’s why your business needs a professional service that deals with high risk credit card processing. EMB gives all types of merchants the opportunity to accept EMV-chipped cards by the October deadline and after.