Let’s Talk EMV—Key Questions to Ask
Your merchant acquirer plays a big part in your decision as to whether you should implement and roll out EMV payment acceptance. Per Visa, MasterCard, Amex and Discover, it is not mandatory for a business accepting credit and debit cards to implement EMV.
It is also important to understand that every EMV card issued in the U.S. will continue to have a magnetic stripe, with no plans to sunset this feature. In other words, you’ll still be able to accept card payments after the October 2015 liability shift, even if you have not implemented an EMV-enabled solution.
Factors to consider in your EMV decision
What increased card fraud levels are anticipated following the liability shift? Prior to October 1, businesses are not responsible for counterfeit fraud chargebacks, but this will not be the case after the deadline. Understanding your risk should play a big part in your decision to move forward.
What will my customers’ perception be if I don’t offer chip acceptance? Consumers are becoming increasingly concerned about card security and are likely to do business with those they deem more secure.
What percentage of my transactions are card present? A business that does 90 percent of its business online may not have a need to implement EMV. A business with the opposite percentage or no e-commerce should enable EMV.
Do I accept many international cards today? Your merchant acquirer can tell you this. Being that the U.S. is the last developed country to move forward with EMV, international cards are likely EMV. A significant percentage of card fraud is coming from outside U.S. borders, so EMV is an excellent idea if you accept international cards.
Next steps to EMV implementation
Once you’ve made the decision to move forward to implement EMV, it will be important to understand the cost, acceptance methods, training and other requirements. Ask your merchant acquirer the following questions:
What is my cost for upgrading, updating or replacing my POS system or terminal for EMV?
Is my current terminal or payment device EMVCo listed? It is critical to reference this site to verify that the terminal you have or will be purchasing is on that list.
Can I retrofit my current terminal to add a customer-facing PIN pad that provides EMV contact and contactless acceptance, or do I need to invest in a new terminal? What options are available?
If the cost to upgrade my POS system is higher than I can afford, are there other options to consider such as a stand-beside terminal?
What customer verification methods (CVMs) do I need to implement? CVM types include:
- “Chip and PIN,” where the customer enters a PIN to authenticate. “Chip and PIN” will be favored by businesses with a high average ticket. It also will be implemented by businesses accepting a high percentage of international cards and those at a greater risk of chargebacks due to counterfeit, lost or stolen acceptance.
- “Chip and signature,” where the cardholder signs the receipt. Businesses with a moderate average ticket and a lower-than-average risk of counterfeit chargebacks will implement this customer verification method.
- “Chip and no CVM,” where the consumer does not sign a receipt such as is the case at quick-service restaurants that require minimal customer queuing and short transaction times.
Do I need both EMV contact and contactless? In some businesses such as quick-service restaurants, it makes sense to explore contactless acceptance. Check with your merchant acquirer to discuss the best solution.
More food for thought
Staff training is vital to successfully rolling out EMV. The card acceptance process for EMV cards is different than magnetic stripe, so ask your merchant acquirer for quick reference guides, tutorials and in-person training. Training efforts will not be a “one and done” but rather a series of sessions to reinforce these steps.
Corporate offices should consider monitoring fallback transactions at stores, as fraud can be forced to magnetic stripe readers by disabling a terminal’s chip reader. Will there be any changes in batching and settlement processes? What changes will I see on my statements? Will my monthly service or per-transaction fees be reduced with EMV acceptance? Do I need to be concerned about offline authorization?
EMV is a big change but it doesn’t need to be painful. If you have questions about EMV, visit our EMV resource page.