The Switch to EMV: Protecting Consumers from Fraud and Retailers from Liability
As technology rapidly advances, so does the talent behind scammers. Credit card thieves are becoming increasingly more skilled, which is why switching to a secure transaction method is essential for retailers. There is now a solution that must be implemented with a sense of urgency – and not because of its benefits – but because you will be at risk if you don’t.
The solution is called EMV – which stands for Europay, MasterCard, and Visa. EMV is a global standard developed for “chip cards” which enable transactions to be automatically authenticated. The importance in this concept lies in what it can do – prevent fraud for consumers. The catch is – the investment in this new technology isn’t exactly optional. By October 1st, all retailers will be required to comply with this technological advancement. After this date, the liability will shift to the party who is the least EMV-compliant in a fraudulent transaction. For example, if a fraudulent transaction occurs, and your retail company has not yet transitioned to EMV, you are responsible for the losses incurred on the consumer’s behalf. It’s important that you begin to consider when and how you will make the transition to EMV after weighing the potential implementation costs with liability and level of fraud risk.
How to Gauge your Level of Fraud Risk
With your deadline right around the corner, the decision to transition to EMV is somewhat dependent on your level of fraud risk. These are just some of the points to consider:
It is important to know your business and your customers in order to make the most effective transition plan possible. This depends on a combination of your industry, location, and payment methods used. The key factors that must be taken into consideration include the cost of transitioning to EMV and the potential liabilities that arise after October 1st. If you are a retailer that has a history of fraud, it may be wise to invest in the EMV technology sooner than later to prevent being liable for costs later down the road with fraudulent transactions.
A phased approach to implementing the EMV technology may be an effective method for your company, and if so, you’ll want to transition in stores with higher fraud risk first. You also need to look at your industry sector and the various payment methods that are used. If you are in an industry with mobile payment options your store is more susceptible to fraud. With that, it’s in your best interest to make the transition sooner.
At this point, you may be wondering how to put together a transition plan. Start by downloading The Retailer’s Guide to Surviving the Switch to EMV to get more information and learn the steps your company can take to make your transition go as smoothly as possible.