How Will Chip-Embedded Credit Cards Change Your Business?
If your business accepts credit cards, you’ve likely been hearing talk of EMV cards for quite some time. While Europe and Canada switched to these types of cards years ago, US card issuers have been slow to provide chip-embedded credit cards to consumers. Now that the switch is underway, it’s critical that you educate yourself about how they’ll change your business so that you and your employees can adapt accordingly.
Less Card Present Fraud
The primary issue with the traditional magnetic strip credit cards we’re all so used to is that the data from the magnetic strip was easy to steal and duplicate on counterfeit cards. Since the cardholder likely wouldn’t know there was any sort of a problem until they received a statement full of fraudulent purchases, merchants and card issuers were left eating these losses.
With chip-embedded credit cards, card present fraud will become virtually a thing of the past. Unlike the magnetic strip data that was useful for unlimited purchases, the security chip in the new EMV credit cards will create a transaction code for each transaction that is only good for that one transaction. Once the chip creates the code, your customer will still need to verify their identity by providing a signature or entering their PIN into your machine.
Remember: your business will face higher financial liability if you don’t switch to the new EMV technology and subsequently suffer a data breech than you would under the old system.
Longer Transaction Times
Because chip-embedded credit cards create new transaction numbers every time the card is used to make a purchase, you may find that it takes longer to process each EMV credit card transaction. Of course, the bulk of the extra time may come from consumers who don’t understand how to use their chip and PIN or signature cards.
For a smoother transition, instruct your employees on how the new system works so they’ll be comfortable walking customers through the process. Rather than swiping their cards, consumers will now insert or dip their cards into the reader and leave them there for the length of the transaction. If they try to swipe a chip-embedded credit card, the machine will prompt them to instead dip the card so it can read the security chip. For customers still using magnetic strip cards, they will be able to swipe their cards as usual.
Online Transactions Unchanged
At this time, EMV technology is only useful for dealing with card present fraud, not tackling the online purchase fraud. Until such time as the chip-embedded credit card technology evolves, the way your customers make purchases from you online will remain unchanged.
8 FAQs about EMV Credit Cards. CreditCards.com.
The “EMV Liability Shift” is Coming (What Merchants Need to Know). Data Protection Report.
EMV Key Dates Chart. Verifone.