In recent years, the threats impacting retailers' point-of-sales systems have only increased in sophistication and complexity. Now, hackers utilize an array of different strategies in an attempt to capture customer information for malicious and fraudulent purposes. At the same time, it's up to businesses to work to ensure that this doesn't happen and that consumers' sensitive data is properly safeguarded.
Recently, the financial service industry took a significant step to better protect shoppers and their credit and debit transactions with EMV chip technology. EMV – Europay, Mastercard and Visa – became a new global standard, and an Oct. 1, 2015, deadline was put in place to spur retailers and financial service providers to leverage the new payment processes approach.
Although it's been more than a year since this deadline has passed – which officially shifted the liability for payment card to the least-EMV compliant party – many retailers still don't have the ability to allow customers to utilize their EMV chip cards.
There are several compelling reasons to make the switch to EMV. Let's take a look at just a few of the ways it can pay to have EMV systems in place within your business:
1) More consumers than ever have EMV credit and debit cards
According to statistics gathered by CreditCards.com, a considerable number of consumers now have EMV-compliant payment cards, providing them with higher security when allowed to pay with the chip at retail points of sale:
- As of fall 2016, an estimated 77 percent of American-issued credit cards had EMV chip technology in place.
- In addition, 38 percent of U.S. debit cards were EMV compliant.
- Overall, about 600 million EMV chip payment cards have been issued to American consumers.
When these were issued by financial service providers, many customers also received information about the new chip technology and the security benefits it could provide. What's more, as many consumers are now aware of the mounting threats targeting the retail sector, they'll be looking to retailers to allow them to utilize their new EMV-compliant chip cards.
2) Your business will be in good company
In addition to consumers, a significant number of retailers are now using POS solutions that support EMV technology. CreditCards.com found that 15 million POS systems were in need of an upgrade for EMV compliance, and since then, about 38 percent have been successfully upgraded.
"Together, the chip card and chip-enabled terminal form a system that helps reduce counterfeiting, as well as prevent payment card fraud and its associated costs," Entrepreneur contributor Tyler Vaughey wrote.
3) Demonstrate a commitment to security
"Many consumers, as well as retailers, are aware that EMV chip cards can be beneficial to security."
As noted, many consumers, as well as retailers, are aware that EMV chip cards can be beneficial to security. In this way, having an EMV-compliant payment processing portal in place within your business shows your customers that your organization is committed to security and the protection of sensitive transaction information.
"Chip technology, with or without a PIN, prevents counterfeit fraud, which represents the biggest category of payment card fraud in the U.S.," ComputerWorld contributor Jaikumar Vijayan wrote.
What's more, due to the high publicity of payment card-related breaches in the news lately – which can considerably damage the reputation of the victim company – some customers may be hesitant to utilize less secure forms of payment. Vaughey pointed out that EMV technology and the acceptance of chip-enabled cards can be a beneficial way to quell these concerns. This is true even for businesses that have never had a security incident in the past – EMV payment processes helps put customers at ease when they utilize their credit or debit cards.
4) Prevent costs related to liability
The October 2015 deadline introduced an important shift within the financial services and retail industries. After this date, any service provider found to be noncompliant with EMV is responsible for fraudulent transactions. In other words, if your business is the victim of a security breach that impacts your customers and you did not implement an EMV chip reader, your organization has to cover any fraudulent activity – not the bank backing the compromised payment card.
"[B]usinesses that do not have EMV-enabled systems may be held liable for certain fraudulent transactions," Vaughey wrote. "We know that every dollar counts to keeping a small business running and successful. Why put those dollars at risk when you can avoid the liability?"
Overall, there are a range of reasons EMV compliance makes sense for today's businesses and the security of their customers. To find out more, contact the experts at 911 Software today.