Credit & Debit Card Payments vs. EMV Payment Cards

As a busy business owner, have you had any time to actually follow the latest news about the migration to EMV payment cards?

While the transition, which officially went into effect as of October 1, impacts any business that accepts debit or credit cards in person, approximately half of small business owners say they have never heard about it, and just 42 percent are planning to switch to EMV technology, according to a recent survey conducted by Intuit.

Unfortunately, the merchants who said they were not planning to switch are not aware that this decision could place their business at risk. And, if your company has not been using EMV compliant point-of-sale terminals as of the October deadline, you may be liable if certain types of credit card fraud occur as a result of a transaction with your business.

EMV, which stands for Europay, MasterCard and Visa, is a global credit card standard that works to make in-person card transactions more secure. The standard has already been in use or being adopted in more than 80 countries globally, and has greatly diminished payment card fraud incidents in countries where it’s been adopted.

Unlike most debit and credit cards, which traditionally store sensitive customer data in a magnetic strip, EMV cards feature tiny embedded chips. So, when the card is inserted in a store’s card reader to make credit or debit card payments, the chip generates a unique code per transaction. This unique code is only used once, making it difficult for thieves to steal. Finally, with an added layer of security, users also must either sign or use a PIN to approve the transaction.

A switch to EMV will improve the security of a business’ system, and in light of recent data breaches, customers are looking for merchants they can trust with their credit information. Here is some important advice for merchants ready to transition their business:

  1. In order to accept EMV payment cards, your business must first set-up EMV enabled point-of-sale terminals and software. Your current point-of-sale (PO) terminal provider can give you the details as to whether or not they need upgrading or replacement. If your machines are relatively new, they may have EMV capability that simply just needs to be turned on.
  1. Find out whether the POS-related software you currently use is compatible with the new EMV technology. They also may need upgrades or replacement.
  1. The sooner you start the process, the better. Don’t forget to consider company-wide training. It sounds simple, but customers with EMV cards will have to insert them into the new card terminal instead of swiping them. Customers without EMV cards will continue to swipe them. Your employees need to know how to accept these different methods of payment.
  2. Evaluate other security measures. If your business is upgrading terminals, it makes sense to research other ways to reduce card fraud and data theft. Be sure to ask your card processor about other critical services and technologies.

As payment issuers across the country replace traditional magnetic stripe cards and terminals with new systems, merchants need to know about how the EMV chip technology migration will impact their businesses. BillingTree can help provide support when it comes to this important transition.