EMV stands for Europay, MasterCard and Visa and is a global standard

for cards equipped with computer chips and the technology used to

authenticate chip-card transactions.

By October 2015, new liability

rules in the United States will

require restaurants and

merchants to make the switch

to terminals that handle EMV

cards. To prepare for the shift,

merchants must consider new

in-store technology and

internal processing systems.

EMV chip cards are

manufactured with a small

integrated circuit, or chip,

inside the card. Data for each

payment is read from the chip

instead of the cards magnetic

stripe. During a transaction, an

EMV card is inserted into the

terminal for the duration of the

purchase to ensure the card is

valid. The card can be

removed when the transaction

is approved and complete.

Instead of swiping the magnetic stripe on your card,

EMV cards are processed for payment in two fluid

steps: card reading, then transaction verification.

Chip cards are read by whats called card dipping,

or inserting your card into a terminal slot.

The dipping method takes slightly more time than

traditional card-swiping; however, EMV cards also

support contactless card reading. Consumers know

this method as tapping, as it asks them to tap or

hold their card against the terminal for chip reading

and payment. Merchants with significant foot traffic

may consider contactless card reading to keep the

checkout process quick.

Using chips instead of magnetic stripes have the

potential to significantly decrease card fraud.

Chips are unique, making them difficult to

read and expensive to counterfeit.

Each time the chip is read, a unique

transaction code is generated that cannot be

used again, which prevents info from being

stolen and used over and over by criminals.

Some EMV cards also use a pin number for

added security (this depends on the

verification method tied to your EMV card, not

whether your card is debit or credit).

In 2005, EMV cards became commonplace in the European Union,

followed shortly by Canada in 2012. Though chip cards are now popular in

the United States, they may be required for use by October 2015, with the

full switch happening by 2017. New liability laws will go into effect this fall.

The laws mandate that card-present fraud

liability will shift to whoever is the least EMV-

compliant party in a fraudulent transaction.

In many cases, this means the merchants

not following EMV protocol will be liable for

any counterfeit smart card transactions

since, theoretically, having the EMV terminal

could have prevented the fraud.

October 1, 2015: Visa, MasterCard, American Express, and Discover

will enforce a liability shift for POS terminals.

October 1, 2016: MasterCard will launch a liability shift for ATM usage.

October 1, 2017: Visa, MasterCard, American Express, and Discover

plan to extend new liability shift laws for pay-at-pump gas stations. The

same will go for Visa and American Express payment at ATMs.

Yes: starting in October 2015, the least-

EMV compliant party will be liable for any

counterfeit smart card transactions.

With new regulations in place, merchants

across the United States should review

their point-of-sale systems and any in-

store hardware and software.

Small businesses may be able to transition

quickly to EMV by simply adding a new

external pin pad.

Larger companies will need to plan and

budget for upgrading multiple systems with

individual terminals.

With the liability shift coming in October 2015,

your business will need to be able to accept EMV.

Only the latest machines can read and process

the chips embedded in EMV cards. Leap

Payments offer a variety of payment processing

solutions including EMV countertop and wireless

machines to meet the needs of any merchant

environment. All Leap Payments machines also

support credit, debit, gift cards, electronic checks,

and all transactions types such as sale, void,

refund, tips, etc. perfect for any business.

Leap Payments is dedicated to providing the best merchant credit card processing

services in the industry. It is their mission to provide open, honest, and transparent

payment solutions to help clients reduce their costs and get paid faster.

For more info, visit http://www.leappayments.com/ or call 800-993-6300.

Sources

http://www.leappayments.com/emv-the-future-of-

card-technology/

http://www.merchantmaverick.com/really-need-emv-

chip-card-terminal/

Summary

By October 2015, merchants must make the

shift to EMV terminals to avoid new liability

laws. This presentation includes an overview

of how EMV terminals work, and how to

make the switch, plus info on how Leap

Payments can help.