We get asked this question all the time, so I figured I’d answer it here on our blog.
While it’s technically true that no one is going to force you to upgrade to an EMV chip card terminal, it is not a gamble that is advisable, and it all has to do with how risk is viewed in a post-EMV world.
What’s the Risk?
As of October 1, 2015, liability shifted from payment card issuers to merchants for certain types of fraudulent transactions — that is: if a merchant is currently using a USB card swiper or older terminal, the merchant is liable for paying any fraudulent charges that happen when a chip card is used for in-store transactions.
That means that if you choose NOT to accept EMV chip cards at this point, and choose NOT to upgrade to an EMV chip card terminal, you’re subjecting yourself to potential fees resulting from any fraudulent sales run through your account.
Not only will you be liable for the costs of the transaction amounts, you’ll be liable for any fines and penalties associated with the fraud and liable for damages that any party involved feels has been done to them. You’ll also suffer from the negative, long-lasting PR that comes with fraud.
“But I Haven’t Seen Any EMV Chip Cards Yet …”
That may be the case. But you should know that all major U.S. banks are currently issuing EMV chip cards in large quantities. There will be over one billion EMV chip cards issued in the U.S. soon, which means you’ll start seeing more and more EMV chip cards in your establishment come 2016.
That said, not only are you potentially putting your finances and reputation at risk by not upgrading to an EMV chip card terminal, you’re also risking losing credibility with customers by not offering EMV acceptance, and one day, you’ll get a customer who doesn’t have a magnetic stripe on the back of their card — and you won’t be able to take their payment!
What About Online Transactions?
It’s worth noting that EMV chip card technology does not protect against card not present fraud. EMV chip card technology is only helpful in a card present environment, and will not be of any added benefit to online merchants. You’ll want to continue verifying addresses and shipping locations, and trusting your better judgment when accepting online sales.
For ways to combat card not present fraud, see the article: Help! Card Not Present Fraud Is on the Rise. What Can I Do to Prevent It?ff
We Can Help!
When it’s all said and done, if you accept payment cards in-store or in person, you should really upgrade to an EMV chip card terminal as soon as possible if you haven’t done so already. With so much risk involved, it just makes good business sense — and upgrading doesn’t require as much time and effort as you might think.
At Constellation Payments, we offer a full set of EMV chip card terminal options for every budget with the choice to buy or rent. See our terminal solution set here, then give us a call at 888.244.2160 or send us an email at firstname.lastname@example.org.
We’ll gladly help you by answering any and all questions — and walk you through the process, so you get the right terminals in place for your business.
Rick Ellis is a Business Development Executive with over 20 years of experience running a successful membership-based company built around a lucrative recurring revenue business model. As an Executive for Constellation Payments, a fully integrated and proprietary payment gateway and merchant services provider, as well as for Member Solutions, a leading provider of full-service billing for enterprise businesses, Rick enjoys working through complex business models, and leveraging proven payment processing strategies for maximum effect.
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