The Small Business Guide to EMV Compliance


EMV? Chip and PIN? What does this all mean? If you find yourself asking these questions, don’t worry, you’re not alone.  As we near the deadline for merchants in the United States to adopt the EMV compliance standards, it is apparent that many merchants are uninformed and uneasy about the upcoming changes and what it means for their business. This shouldn’t be the case, so we’ve compiled a brief background of EMV, how it affects merchants, and what they need to do to ensure they’re compliant.

What is EMV?

EMV, an acronym for EuroPay, Mastercard, and Visa, is a set of globally recognized standards ensuring the proper usage and communication between microchip-equipped cards and the hardware used to complete transactions. EMV is designed to increase security for ATM and credit card transactions, as well as minimize in-store card fraud. The technology was originally introduced in 1995 and over 80 countries have either already adopted, or are in the process of adopting the EMV standards today. These countries have seen dramatic decreases in card fraud since the technology was introduced. The U.S. is one of the last major countries to adopt the EMV guidelines, but with the recent security breaches with major retailers like Target and The Home Depot, many feel it can’t come soon enough.

How is EMV More Secure?

So, why exactly is EMV more secure? There are two main reasons. First, in order to complete a transaction, the cardholder must insert the chip card into an EMV card reader then enter a PIN. This two-step process increases security at checkout, as a fraudulent card user can no longer just swipe the card and forge the card owner’s signature. Second, the data from the EMV cards is tokenized, creating a dynamic transaction code for each individual purchase. This prevents hackers from gathering card information and using it at a later date, as opposed to traditional magnetic stripe cards where the data is static and can easily be copied and duplicated.

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