By guest writer Phil Kluge, Transaction Resources, Inc. 

Big changes are here for businesses that accept credit card payments.  Essentially, an EMV liability shift takes place October 1, 2015 that could cost your business a lot of money if you end up processing fraudulent transactions.

EMV is an acronym for Europay, MasterCard, and Visa. EMVCo is now the organization that will manage the standards for MasterCard, Visa, Discover, American Express, JCB, and China UnionPay.

According to EMVCo’s website:

“EMVCo exists to facilitate worldwide interoperability and acceptance of secure payment transactions. It accomplishes this by managing and evolving the EMV® Specifications and related testing processes. This includes, but is not limited to, card and terminal evaluation, security evaluation, and management of interoperability issues. Today there are EMV Specifications based on contact chip, contactless chip, common payment application (CPA), card personalization, and tokenization.

This work is overseen by EMVCo’s six member organizations—American Express, Discover, JCB, MasterCard, UnionPay, and Visa—and supported by dozens of banks, merchants, processors, vendors and other industry stakeholders who participate as EMVCo Associates.”

In the U.S., EMV may be implemented as Chip and PIN, Chip and Signature, or other variations.  It is up to the issuer to choose.  As always, an effective strategy to protect against duplicate card fraud is to maintain a “card-present environment”.

EMV Liability Shift

Beginning October 1, 2015, if a business accepts a “chip card” without the use of an EMV capable terminal, the business will be liable for any fraud connected with those transactions even if the business receives an authorization for the transaction.

However, if a business has an EMV capable terminal, receives an authorization and later finds that a fraud occurred with a transaction, the issuer would be liable for that transaction instead.

What Does EMV Mean to Merchants?

If your credit card terminal is more than 12 months old, you should replace that terminal with one that is EMV-capable that supports:

  • Magnetic Stripe Reader
  • Chip Card Reader
  • NFC Reader (Apple Pay, Google Wallet)

What Should You Do At Your Business?

Even though there has been slow adoption of EMV in the U.S,, POS vendors and processors are now scrambling to meet EMV implementation dates.  Please make sure to talk to your Merchant Services provider or Phil Kluge at Transaction Resources to see if your business is in compliance.

Transaction Resources Inc. (TRI) offers innovative payment processing solutions by combining the latest technologies, a passion for customer service and competitive rates. You can contact Phil Kluge and his team at 781-496-3454. TRI also maintains, which helps businesses build successful gift, loyalty, prepaid cards, and discount programs.

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