High Risk Merchants Brace for Inconsistent EMV Standards

Apr 28, 2015

A heated debate is occurring amongst America’s card issuers and retailers. This year, it was announced that the U.S. is backing a chip-and-signature system to address issues of consumer financial security. Many retail executives and merchant advocates believe the U. S. treasury should have backed a chip-and-PIN (PIN CVM) system instead. They believe this system would have almost guaranteed the elimination of consumer credit card fraud, while some credit card issuers believe the added security of PIN authentication is not worth the cost of upgrades in the wake of Apple Pay and other NFC payment methods.

Many advocates of PIN CVM say that the belief that this type of payment method is too expensive is false. Although merchants may need to pay for software upfront, regions that use PIN CVM note that the money saved in rectifying instances of fraud by retailers and card issuers more than pays for these initial costs in the long-term.

PIN CVM advocates also say that it is the most secure type of payment process. Cardholders are able to make online (when the terminal can dial out to connect to an acquirer in order to process a card transaction and request authorization) and offline payments (when the terminal doesn’t dial out for authorization). If signature is the CVM, consumers will have problems when doing offline transactions. Cards often come with a set limit to the amount spent without signature verification. If a payment exceeds the limit, then the card could be declined.

To further complicate matters, credit card issuers are at odds to which methods they see as best. Visa thinks that chip and signature as a short term solution, while Discover, American Express, and MasterCard are pushing for PIN CVM.

In the end, the business models of each banking institution will decide which EMV payment solution they endorse. If consumer security and the ability to make online and offline payments is important to a banking institution, then PIN may be the best solution. If less security and the possibility of rejection during offline transactions is not a real concern for banks, then the signature system is a viable solution.

Is your business ready to process EMV enabled debit and credit cards? eMerchantBroker.com is the number one payment processor for high risk merchant accounts. Contact us to set up a merchant account regardless of your business type.

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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