Migration to Using Cards With Chip Readers
Is your small business prepared for the upcoming migration to EMV credit and debit cards? EMV (an acronym for Europay, MasterCard and Visa) is a new, worldwide technology standard that is intended to help prevent credit and debit card fraud by enabling more secure in-person transactions. And as of October 1, 2015, businesses of all sizes will be required to have technology in place to accept the new EMV credit cards, or face the risk of being held liable for credit card fraud that occurs at their businesses. That means you!
Unlike today’s credit and debit cards, which have a magnetic stripe that users swipe in a payment terminal, EMV cards have a chip embedded in them. The user “dips” the card in the terminal, where it stays during the transaction. The chip creates a unique transaction code for that transaction that can’t be used again. Unlike the information on a magnetic stripe, this one-time code is much less likely to be stolen. The user accepts the transaction by either inputting a PIN or signing.
EMV cards have many benefits. Once they understand how the new cards work and that they are more secure, your customers will appreciate the security. Your business will be less liable to debit and credit card fraud, which lowers your costs. The EMV standard has already been adopted or is being adopted by more than 80 countries worldwide, and nations where it’s being used have seen payment card fraud drop dramatically.
Clearly, the EMV standard is a good thing for consumers and businesses alike. However, if you want to be compliant with the new EMV standard, you need to get moving, because your point-of-sale (POS) system must be ready to accept EMV cards by October 1. But in a recent survey by Intuit, almost half of small businesses had never heard about the EMV transition deadline, and fewer than half were planning to make the switch to EMV technology.
Don’t be one of them! Start by contacting the payment processing company that provides your current POS. If the system is relatively new, it might already be EMV compliant once that feature is switched on. If not, you may need to upgrade to a new POS; your provider will be able to tell you.
While you’re at it, talk to your provider about getting a terminal that can accept other types of payment technologies such as NFC (near field communications) and Apple Pay and other mobile wallets. For example, the Clover Mini terminal, sold by a wide range of major banks, offers businesses the flexibility to accept a variety of payments options including EMV (both chip and PIN and chip and signature), NFC (Apple Pay™) transactions, cash, credit, debit, and prepaid. After all, the more current features you get now, the fewer upgrades you’ll have to make later.
Along with the new POS hardware, make sure that any software you use related to your POS (such as inventory or loyalty software) will work with the new terminal.
If your payment processing provider isn’t helpful or responsive in getting you the information and upgrades you need, look for a new one without delay. Now is a good time to do so—with the EMV transition around the corner, there are plenty of attractive offers out there. For example, Square is offering its customers a free EMV reader and Intuit is offering an EMV reader for $30
Don’t wait too long to start the upgrade process; in addition to getting the new POS terminals installed, you’ll need to train your employees on how to use them and make sure everything is working properly before October 1.