4 Facts: EMV Credit Card Processing for Merchants
EMV Credit Cards (or Smartcards) are here. This new technology is meant to safeguard merchants and customers from security breaches that result in millions of dollars in credit care fraud each year. The new EMV Credit Cards have a chip embedded into them that boast and extreme increase in security over the old magnetic strip.
This new EMV technology is having an enormous impact on the merchants that accept credit cards at their businesses. Below are 4 quick facts about EMV Credit Card processing and what it means for businesses that accept credit cards.
1) What Is EMV?
EMV stands for Europay Mastercard Visa. It has been the global standard for credit cards with a “chip” embedded in them for increased security and protection from fraud.
US Credit Card issuers are switching over or migrating to this new type of credit card in the wake of several large scale credit card information breeches at several large, national retailers, including Target.
EMV Credit Cards have been used in Europe for a long time, as well as other places. The United States has always weighed the cost of migrating to the new technology as too heavy until recently.
2) EMV Credit Cards Are More Secure
EMV credit cards contain a small chip that will add increased security to credit card transactions. This smartchip is what sets this new generation of credit cards far beyond the magnetic strip that the United States uses today.
The magnetic stripes on credit cards in the United States today contain static, unchanging data; anyone can capture the information from one transaction and counterfeit new transactions using the personal information gathered from one breached transaction.
The reason why EMV credit cards are so much more secure is that they create a unique transaction code for each transaction that cannot be used again. Therefore, even if there was a data breach in the EMV credit card terminal, the thief could not use the data obtained to replicate further fraudulent transactions because the code would just get denied.
Although this new technology will not eliminate data breaches, it will make it incredibly hard for criminals to use the data obtained for profit.
3) You Need an EMV Capable Terminal
With the new chip technology of the EMV credit cards, merchants will need a new terminal to accept these new cards. EMV credit card terminals read the EMV chip that is embedded in the EMV credit card.
Unlike the magnetic stripes and the swiping method used with credit cards in the US today, the new EMV terminals have you insert the card into the terminal and it remains there for the duration of the transaction.
Customer facing EMV pin pads are also available for merchants who wish to allow their customers to insert and run the transaction and complete the transaction with a pin number.
4) What Happens If I Do Not Want To Accept EMV Credit Cards?
The decision for the migration to EMV Credit Cards was not a light one. The main credit card issuing companies have put off this transition for a long time compared to Europe and other major markets.
However, due to an increasing number of data breaches and credit card fraud, the main credit card issuing companies have decided that the heavy cost of time and money involved in transitioning to a safer, more secure form of credit card processing is worth it.
Because the major credit card issuing banks have made this decision, they expect the new EMC Cards to be accepted by all merchants. If a merchant does not wish to accept EMV cards after the migration date, that merchant will be responsible for all costs associated with any fraud will fall to the merchant/ businesses if they chose not utilize the increased security of the EMV credit cards.
This announcement is huge for businesses, most of whom cannot afford to be liable for credit card fraud that happens as a result from not having the correct terminals for accepting EMV credit cards.
You can read more about how to prepare for the EMV credit card migration that is coming to the US by getting more information from Premier or by reading Visa’s US Merchant EMV Chip Acceptance Readiness Guide.