MasterCard Extends Zero-liability Policy to High Risk ATM Transactions

Jun 18, 2014

MasterCard Inc just announced an extension of zero-liability coverage to their North American customers. Under this policy, there will be no penalty if a customer’s debit or credit card commits unauthorized transactions; this includes PIN based and high risk ATM transactions. The move is a welcomed relief to MasterCard cardholders. In the midst of a tidal wave of security breaches, consumer confidence in the security of their private credit information has plummeted.

Gil Luria, an analyst for Wedbush Securities Inc. states, “the move by MasterCard just enhances the sense of security for people at a time when it has been shaken up significantly in recent times.”

The announcement could also mean an influx of new customers for MasterCard. Since the highly publicized security breaches of retailers like Target, which resulted in over 40 million debit and credit card information stolen, more and more consumers are searching for companies that emphasize security and offer zero liability options.

Currently, zero liability protects consumers against fraudulent transactions that require a signature. Visa Inc. offers zero liability but the plan does not cover PIN-based or ATM transactions. MasterCard’s new policy which includes PIN transactions and high risk ATM transactions will begin in October.

The new policy makes MasterCard the only major card issuer to offer full zero liability, and is designed to motivate consumers to continue to trust and use their credit cards. “The changes that we’re making in cardholder protection combined with our efforts to move the U.S. payments industry to EMV chip technology will help deliver safer shopping experiences to consumers,” said Chris McWilton, the president of MasterCard’s North American Markets.

Visa and MasterCard Inc. have both urged banks and retailers to adopt the “EMV chip” by the October 2015 deadline. The technology is designed to make credit card transactions safer and has been used in countries around the world for many years.

Phillip Philliou, the manager of a firm that helps banks and retailers select payment processors adds, “This all comes back to the adoption of EMV,” Philliou says, “of all the cards that are breached at ATMs, a majority of them are non-EMV cards. This is just another way for the company to impress upon the importance of quickly adopting EMV cards.”

MasterCard will also offer cardholders identity theft resolution assistance that closes down missing card accounts, alerts credit report agencies, and conduct searches for stolen data online.


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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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