Chips Ahoy! What merchants (and their customers) want and need to know about smart-chip (EMV) cards

For businesses that accept credit or debit card transactions, EMV is coming, and soon. In fact, we’re already working with clients on their migration plans, so we thought now would be a great time to share the most common questions we’re hearing (and our answers to those questions), and address not only the merchant, but the merchant’s customers. After all, that’s when the chips are down.
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For the merchants
Q: What’s the purpose of EMV (and what’s it stand for)?
A: “EMV” stands for “Europay MasterCard Visa.” It’s the new global security standard for credit card processing. These new smart cards have a small computer chip that actually creates a unique transaction every time the card is used. So unlike current magnetic-stripe cards that store data which never changes and thus enables thieves to utilize stolen info indefinitely, smart cards treat each transaction individually.

Q: What’s this I hear about a “liability shift?”
A: Good question. Currently, issuing banks are liable if a transaction occurs with a counterfeit, stolen, or compromised card. Come October 15, 2015, however, the liability falls on the party who’s least compliant. If you’re a merchant that can’t accept transactions from an EMV smart card, that might be you.

That doesn’t mean you can’t accept credit or debit card transactions the old fashioned way. They will still have the magnetic stripe for quite a while also. In fact, some industry experts predict by the end of next year about 70 percent of credit cards and 40 percent of debit cards will be EMV-enabled. And about one half of banks and retailers are anticipated to be switched over by the end of 2015. But do know that if you don’t make the switch, you (and your business) are exposed. Not a good thing. And, increasingly, your customers will realize you’re processing the “old fashioned way,” and there goes your customer loyalty!

Q: OK, so what’s in it for me?
A: First, a higher level of security of your customer’s sensitive information, which benefits your brand. You’ll also be ready for cool new payment methods like mobile wallets. And compliance to PCI standards will be simpler.

Q: What do I need to do?
A: Talk to your credit card processing services company. Depending on your current processing method, they’ll be able to determine what you’ll require going forward. For many clients, all that’s needed is a one-time new equipment purchase and a little training. EMV cards aren’t the black magic some folks have made them out to be. Trust us, you’ll love the feeling of security – and so will your customers.

Q: Where do I turn to with more questions?
A: We’re always here, 24/7, at 316-265-4477 or 800-864-4644. Or, here’s a good Q & A source from the Smart Card Alliance.

For the merchant’s customers
Q: Why is this happening?
A: As hackers get better, card transactions are not as secure as they once were. And frankly, this is simply the United States catching up with Europe, who’s had EMV smart cards for a while now. So it’s time to up our game here in the U.S. In fact, by the end of 2015, all new cards issued will have smart card EMV chips (along with magnetic strips, so you’re not stranded at Fred’s Bait Shop). The chip creates a unique transaction every time the card’s used, so there’s no ongoing, stored customer data that can be accessed with a breach.

Q: How will the new cards work?
A: From the customer standpoint, nothing’s really changing. Instead of swiping, however, they’ll be “dipping” into a new device. The process is just a wee bit slower (hardly detectable, unless you’re paying attention), and there’s a bit of a lull when dipping (versus the quick in-and-out flick of swiping). But for the most part, it’s essentially the same transaction, but with updated security.

Q: What do I need to do?
A: Nothing! Your card issuer is responsible for providing your new EMV smart chip card. Very likely it’ll be when your current one expires. So until then, just keep swiping with your current card.

So there you have it, a brief overview of EMV credit card processing. At Acumen, our goal is to make your hectic life simpler. Got a question? So give us a call. Because when it comes to merchant services, at Acumen, Your Business is Connected.

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