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Are You Ready for the EMV Credit Card Changes?

The transition to the EMV global standard for credit card payment is already underway, and will officially become the U.S. standard in October 2015. It promises to be a more secure payment processing method, more resistant to credit card fraud, and is a welcome change in many ways for card issuers and merchants alike. As with any change from the norm, a few adjustments and some planning will go a long way in making the change smoothly.

Preparation for accepting payments using the EMV standard begins with the installation of the card reader itself. EMV cards are embedded with IC (integrated-circuit) chips. These circuits are susceptible to what is known as ESD, or electrostatic discharge, that can permanently damage the circuit or cause errors in the processing of a payment. To avoid such issues, it’s advisable to take precautions like using table mats, floor mats, or carpeting that can dissipate static, or rubbing the card on one’s clothing prior to swiping. Training of employees on the risks of ESD is strongly advised.

Timing is another factor to consider with the EMV standard. Since cards are not swiped in the traditional way, but dipped, the process is not quite as instantaneous as consumers and merchants are accustomed to, while the card is authenticated and a unique transaction code is generated. Merchants may need to educate employees and customers initially about this slight delay inherent to the dipping method of card processing.

There are two different verification methods used for card-present payment processing: chip and PIN, and chip and signature. For a majority of U.S. card issuers, the method will depend on the type of card being used, for the purpose of keeping the process as familiar to consumers as possible, at least initially. So debit card holders will likely have a chip and PIN verification process, while credit cardholders will do the chip and signature method.

EMV will not impact online payment processing, nor offer any additional security against fraud. Where payment processing in a card-not-present environment, everything works the same as with traditional magnetic stripe cards.

It’s important to note that as of October 1, 2015, liability shift takes place in the U.S. for merchants not EMV-compliant who process payments with fraudulent cards. It will no longer be the liability of card issuers, and merchants can face hefty charge-backs in cases of credit card fraud.


photo credit: Sean MacEntee

Posted on June 1st, 2015 by Rachel Braam, Office Manager

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