Vail Valley Merchants – Is Your Business Ready for the EMV Liability Shift on October 1st?
EMV chip technology is rolling out to consumers and merchants in the United States. Credit cards with EMV ‘chips’ protect in-store payments by generating a unique, one-time code needed for the transaction to be approved. The feature makes it virtually impossible to counterfeit cards, helping to eliminate in-store fraud.
On October 1, 2015, in-store counterfeit fraud liability will shift to the party – either the issuing financial institution or the merchant – that has not adopted chip technology. Understanding how this liability shift affects your business can help protect you from liability exposure.
After October 1, 2015 the liability for any fraud committed on a swiped card with an EMV ‘chip’ will be the responsibility of the merchant, unless they have EMV compliant processing equipment.
If you’re a merchant that swipes cards you must:
- Have an EMV card reader
- The equipment must be certified by your processing bank
- The software installed on your equipment must be up to date and;
- Your equipment must have the capability to support PIN # encryption.
There are a few exceptions to this liability shift date: Liability for automated fuel dispensers and ATM transactions shifts in October 2017. The EMV liability shift does not apply to card-not-present transactions, lost and stolen fraud, or Visa Paywave or Mastercard PayPass transactions. In these cases, the liability remains subject to existing liability and chargeback rules.
Prepare for the liability shift now! Contact your payment processing source today to ensure that you have EMV compatible equipment.