EMV cards (Europay, MasterCard, and Visa) offer a new type of credit card processing in the U.S. These are chip cards that feature a small microchip and offer improved security against counterfeiting.
EMV Chip Cards Vs Mag-Stripe Cards
Chip cards are designed to process differently. Unlike magnetic-stripe cards that should be swiped, chip cards need to be dipped and require new payment terminals to read them. EMV chip cards are called to be more secure against fraud. They open up doors for the next stage in payment processing, meaning mobile, contactless transactions.
Chip cards technology has been around since the 1980s. It was considered the standard in a number of countries, including the UK, for more than a decade. Statistics show 70% of non-U.S. credit card terminals are EMV enabled.
Merchants now need a new type of processing devices to read chip cards. You should find a reputable processor like emerchantbroker.com to get the necessary assistance and support to meet your business needs. EMB, #1 high- risk merchant account provider in the U.S., offers high risk processing to any type of business, regardless of credit history. EMB offers low-cost services to customers and provides affordable solutions to help you process transactions easily.
Chip cards have proved to be successful especially in Europe. 90% of credit card terminals in Europe are now EMV enabled. According to Barclays, the adoption of chip cards in the UK reduced fraudulent transactions by 70%. Aite Group, a research firm, reports that, in Canada, losses caused by counterfeit transactions, lost and stolen cards counted for 245 million Canadian dollars in 2008 and 111 million in 2013.
Why Did the U.S. Decided to Adopt EMV?
The U.S. lost more than 5.3 billion dollars on credit card processing fraud in 2013. This was up 14.5% since 2012, according to the Nilson Report. The U.S. is the country where half of the world’s counterfeit fraud occurs, with only a 1/4 of all credit card transactions being completed in the U.S. So fraudsters, being unable to attack chip cards, are now targeting the U.S. market.
The main reason for being the last country to adopt EMV has to do with cost. Removing all ATMs, self-service kiosks, registers, ticket terminals, and vending machines will cost about 8 -12 billion dollars.
Recently happened major security breaches, such as Home Depot, Target, and Neiman Marcus, have accelerated the adoption of EMV. Finally, the EMV adoption has become a necessity because using magnetic-stripe cards overseas is becoming more of a challenge.