EMV®¹ Liability Shift Deadline Happened on October 1, 2015 – What Does This Mean For Your Business

The article content is provided with our sponsor, Bank of America Merchant Services.

If you’re a small business owner, then you’ve probably heard about EMV, wondered what it is, and how it will affect you and your business. It’s a fairly significant change for many business owners. Simply put, EMV (which stands for EuroPay, MasterCard® and Visa®) is known as “chip” card technology. Chip card technology heightens security through the use of stronger authentication that reduces the value of stolen data. It’s something that every merchant in the country will want to be aware of, and may change the way they process payment transactions.


EMV and Your Security

You’re already familiar with a standard credit card with a magnetic stripe. You may also know that those magnetic stripes can be very easy to duplicate, which has led to a rise in security issues with credit card companies. Many cards already come with the EMV chip, which are very difficult to counterfeit. Moving forward, all cards will come with this chip technology. As of October 1, 2015 there was a liability shift where merchants who have not adopted EMV technology will now liable for counterfeit fraud losses when a chip card is used. However, if your business’ point-of-sale system is EMV enabled to accept the new chip cards, then the credit card issuer will be liable for any fraudulent activity. This is the liability shift that many retailers and merchants are discussing.

If your business hasn’t adopted the new chip card technology, then you’ll want to weigh any ongoing possible fraudulent charges against the cost of upgrading your point-of-sale (POS) terminals. “Customers will begin to expect when they go into a business that any business will accept their chip card transaction,” explains Bank of America Merchant Services Senior Vice President of Product Delivery, Jonathan Sepulveda.

A recent white paper by Bank of America Merchant Services titled “Why You Should Adopt EMV® Chip Card Technology” explains it this way: “Given some recent large-scale data security issues, there has been a renewed push for EMV adoption in the United States. Because most other major international markets have adopted EMV, criminal rings have taken to using stolen card numbers predominantly in the United States. This so-called ‘fraud migration’ costs banks and merchants. As a result, the major payment networks have decided that the United States needs to be quickly brought up to the global security standards to ensure the integrity of international commerce.”


EMV and Point of Sales Systems

Starting in October 2015, your business faces possible liability for face-to-face fraudulent card transactions that occur if you are not EMV enabled. And – there are more reasons to upgrade. “This liability shift provides merchants with a unique opportunity to not only take advantage of the newest technology in terms of data and protection, but it’s also an opportunity to look at other solutions,” says Sepulveda. “This may be a great opportunity for your business to look at upgrading your POS, or terminal, to best take advantage of the new liability shift, as well as provide you with more solutions and options for your business.”

“You may be inclined to weigh the costs of updating your POS against the risk of fraudulent transactions in your business or market segment,” further explains the white paper. “It may also be an ideal opportunity to modernize your POS systems for improved business performance, through the addition of services such as integrated loyalty programs, tie-ins to eCommerce, business performance dashboards, dynamic currency conversion if your business sees many foreign travelers, and other services.”

“It’s the right thing to make it much more difficult for cards to be fraudulently used,” says Sepulveda. “And it obviously involves costs, but it gives merchants the ability to say to their customers that they value their cardholder information.”


To learn more about the EMV change and how it affects your business, visit http://merch.bankofamerica.com/emv-resource-center or contact a Bank of America Merchant Services business consultant.

¹EMV is a registered trademark in the U.S. and other countries, and an unregistered trademark elsewhere. EMV® is a registered trademark owned by EMVCo LLC.



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