EMV, Apple Pay, NFC, chip cards, chip and PIN, IC Cards …..
Are you feeling confused? All you want to do is to do what you do best – run your business and be able to accept credit cards! Bankcard Brokers is here to help!
Well, there is a deadline for businesses to upgrade their Point of Sale to accept EMV transactions and it is coming fast – October 1st 2015! Did you even know that there is a deadline or what the penalties are if you do not comply? You are not alone if you don’t! As a matter of fact, according to a Wells Fargo/Gallup Small Business Index poll, conducted July 6-10, 2015,only 49% of merchants that have up to $20 million in annual revenue and that accept credit/debit cards say they are aware of the Oct. 1 deadline. If you are aware of the deadline do you know what it means for your business or how to even comply with the requirement? Most importantly – is there any way that your business can benefit from EMV and NFC technology?
What is EMV?
EMV is an abbreviation for Europay, MasterCard and Visa, an international standard for processing payments of integrated circuit cards (IC cards or “chip cards”) and IC card capable point of sale(POS) terminals and automated teller machines (ATMs), for authenticating credit and debit transactions. EMV Integrated Circuit Card Specifications are maintained and enhanced by EMVco, an organization collectively owned by American Express, JCB, MasterCard and Visa.
EMV payment processing technology has not only been adopted it is enforced by just about every other major country, business owner, and consumer in the world with the United States being one of the last! America has been slow to adopt this technology because of the investment in banking infrastructure and retail storefronts that is required. With credit card fraud increasing at alarming rates it is now paramount that our antiquated payment/banking system gets this much needed overhaul. By 2014 all payment processing (acquiring) banks had to meet a deadline to upgrade their payment systems so that they can accept EMV transactions utilizing Dynamic Authentication.
The next step in the plan is for retail business owners to upgrade their Point of Sale to include EMV capable credit card readers to accept credit cards and for banks to issue the much more expensive chip enabled cards. Most business owners can expect to spend just a few hundred dollars per station on a new terminal or POS upgrade. This simple step is not only proven to be incredibly effective in reducing credit card fraud but will also protect your business from the liability shift that occurs on October 1st, 2015. Additionally, these relatively small investments will make huge steps in long term cost savings and the battle against credit card fraud which poses the question: If credit card fraud is reduced will the interchange cost to accept credit cards drop as well? We hope so!
Is EMV the same as NFC?
Although EMV transactions are powered similarly to NFC (near field communication) technology, they are not the same. NFC technology can be used for everything from making grocery lists on your refrigerator to transferring files between devices while EMV is specific to payment authentication utilizing dynamic authentication. Dynamic authentication is a process by which a cryptographic message is included with each credit card transaction making every transaction completely unique. In Europe the combination of chip and PIN transactions coupled with dynamic authentication has been proven to greatly reduce the credit card fraud rates experienced by retail merchants and consumers alike. In the US our EMV standard will start out with a slightly less involved process with just “chip and signature” transactions when accepting credit card payments.
The deadline for your business to be using EMV capable credit card equipment to process card payment transactions takes full effect October 1st, 2015. This transition was strongly urged at the Federal level while the plan and deadline was established by Visa, endorsed by MasterCard, and is spurred by the fact that the United States is the last major country in the world to adopt this more secure payment technology. Being the last major country to adopt a more secure payment technology has made the US a prime focus for international criminals seeking easy targets for identity theft, credit card fraud, and information harvesting. Partly attributed to this is the alarming fact that credit card fraud in the U.S. has risen an alarming 38% between 2013 to 2014.
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What does the EMV deadline mean to your business? and How will the liability shift effect your bottom line?
The EMV adoption deadline for merchants comes with both benefits and penalties set by Visa and MasterCard to expedite the adoption of this technology. Merchants who embrace EMV technology before the deadline will benefit. One of the biggest benefits is that merchants who are able to generate 75% or more of their sales from EMV capable terminals may be relieved of their need to pay for their annual PCI validation compliance.
Additionally, merchants who have installed EMV enabled terminals, in the event of a security breach or fraud incident, will receive some relief from the PCI audits, fines, and fees. Conversely after the October 2015 deadline merchants who have NOT integrated EMV payment technology will have increased liability in the event of a breach. Business owners who choose not to invest in EMV technology will be held liable for all fraudulent transactions that are processed using an EMV card on a non EMV compatible terminal. In other words merchants must be equipped to accept EMV cards by Oct. 1 or take responsibility for fraud losses stemming from counterfeit or lost-and-stolen cards, according to card-network rules. This liability is currently shouldered by issuers.That means that if a customer uses a lost, stolen, or duplicated credit card and makes a purchase at your store on a Non EMV capable terminal you will be billed back for the cost of the fraudulent transaction and any other penalties or bank costs associated with it. Additionally, if it is thought that there is a security breach at your location then this liability could include forensic costs, card replacement and the laundry list of other fines and fees that were traditionally charged to the card issuing bank if a merchant was PCI compliant. These costs quickly add up and could easily put the average small business – out of business. The liability shift is designed as a stiff incentive for business owners to take the proper steps and enable their payment systems to accept EMV payments. If you have specific questions feel free to call us or Visa has released their EMV chip acceptance readiness guide for further reference.
How to accept ApplePay credit card payments…
Now for the upside! OK, so enough of the doom and gloom associated with accepting EMV payments. Let’s hear some good news! One of the most common questions we get at Bankcard Brokers is: “How does my business accept ApplePay transactions?” (or any mobile wallet for that matter).
ApplePay is a lot like its predecessors – the Google Wallet or Softcard (originally known as the ISIS wallet….. but changed their name for obvious reasons). These “E Wallets” allow consumers to securely store card information and make purchases utilizing NFC technology. The good news is that most EMV capable terminals also have NFC capabilities – before you purchase your new terminal make sure to ask if it is both EMV and NFC compatible. Once you have your new terminal your customers can experience the convenience and security of never handing over a physical card to pay for your goods and services they will simply be able to tap and go!
How do you need comply with the EMV deadline?
Simple! Purchase an EMV compliant credit card terminal either as a stand alone or as a plug in for your point of sale software.
How would you like to not only comply with the EMV deadline but do it for FREE and save money on your credit card processing fees? Bankcard Brokers is proud to offer 100% Free EMV compliant terminals and incredibly low rates! To apply now simply CLICK HERE to Apply Today and fill out our simple and secure online application!!
Help keep your customers safe, broaden your marketing opportunities, and reduce your cost to accept credit cards! Get Started with the leading merchant service provider who is committed to Credibility, Legitimacy & Transparency Through Technology and World Class service!