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Kind of curious, if you're a business owner, or in a position that you have to be aware of this.. What do you know, or think you know, about the changes to credit card processing in the US that take effect on October 1, 2015?
Heck, even if you're not in business.. What do you know about it?
I'm 'in the business'.. POS software developer.. And so I'm kinda in the middle of all this.. And it seems that business owners are getting fed a line.. I'm just curious.. What do you 'know' about what happens October 1st so far as credit card processing?
Long story short to define EMV.. In laymans terms.. It's using the chip on the card to process the transaction vs the mag stripe. There's alot more to it than that, but.. That's an overly simplified version, in case you have no clue what the heck "EMV" means.
Here's what really happens...
Spoiler
On October 1st, 2015, liability shifts to the merchant if they accept a counterfeit card through the traditional 'swipe' method or manual card number entry AND that card is EMV ready.. Meaning that it has the embedded chip.
That's it. This does not apply to 'online' purchases, where it's not possible to have the card in hand. The merchant is still protected if the card they accept does not have the chip.
This shift is to 'assist' people in moving to the EMV platform. But the old systems will not shut down on October 1st.. This does not affect consumers (card holders) in any way, other than perhaps shifting how they pay with their cards.. Insert card vs swiping the card. It does help people who travel overseas from the US, as most of the rest of the world went to EMV several years ago.
Pretty much it - just a liability shift (to the party that isn't using EMV compatible equipment). It's my understanding though that the majority of the cards in the U.S. will still be using chip/sig vs. chip/pin. The latter is what the rest of the world is using. So even with an EMV card, it may still cause issues in foreign countries (e.g. you still may not be able to use unattended Kiosks).
From a fraud standpoint, EMV in general helps in reducing counterfit cards. But until you go to chip/pin, it's not going to do anything for fraud through stolen cards.
This doesn't do anything for CNP transactions, hence no impact on Online transactions. I did see an article recently about a card that had a rolling CVV. That would be a real game changer for CNP. Albeit a fairly expensive one.
Chip and Pin is going to be forced by table service restaurants.. Or.. You're going to see restaurants go the way of IHOP, where you get a guest check left on your table which you take up to the register once you're done.
Chip and Sig was a massive failure in Europe, and I think Canada as well (They may have started with C&P tho)
My point behind this was that I've talked to a number of people about this, and when you get down to the business owner level, more than half of them are totally freaking out because of 'scare tactics' that have been used.. Where it's been implied that things will stop working in October.
There have been studies that this reduced fraud something like 70% in Canada.. Frankly, I don't buy it.. It's not going to reduce fraud alot, it's just going to shift how it happens.
Someone steals 10k credit cards, rather than faking a card, they're just going to make massive amounts of online purchases with it.
Chip and Pin is going to be forced by table service restaurants.. Or.. You're going to see restaurants go the way of IHOP, where you get a guest check left on your table which you take up to the register once you're done.
Chip and Sig was a massive failure in Europe, and I think Canada as well (They may have started with C&P tho)
My point behind this was that I've talked to a number of people about this, and when you get down to the business owner level, more than half of them are totally freaking out because of 'scare tactics' that have been used.. Where it's been implied that things will stop working in October.
There have been studies that this reduced fraud something like 70% in Canada.. Frankly, I don't buy it.. It's not going to reduce fraud alot, it's just going to shift how it happens.
Someone steals 10k credit cards, rather than faking a card, they're just going to make massive amounts of online purchases with it.
I don't see how restaurants will be forcing anything when it's the issuers/banks that dictate the type of cards that will be used. If they can force anything, they'd likely force cash purchases to minimize the additional cost of accepting cc payments.
Where is your source that more than 1/2 of all businesses don't understand the ramifications of the EMV move? I know there are a lot of questions, but more than 1/2 of all businesses?
I've also read the 70% decline. But that was Europe (or maybe including Canada), and it was using Chip/Pin. And the US will definitely not see that number since it's a lesser secure method. Increase in online fraud? Probably. But maybe not as much as we think since it does leave a trail to catch the criminals. Whereas just stealing/counterfeiting a card and then buying a ton of gift cards is harder to track.
I am my source. I field concerns from restaurant ownership daily now on this. "Will I still be able to accept payments on October 1st?".. Normally quickly followed by "Can I accept ApplePay?".. Two different questions, the second of which I think is flavor of the month.. NFC isn't going anywhere, but, Applypay.. I'm not sold on it being huge.. MC and Visa will offer 'card on your phone' if they aren't already rolling that out.. Then you have one less hop to go through.
Right now, EMV is led by the CC Processors.. If they get pushback from their clients.. It will change. Will it go back? No.. However, on a chip and signature purchase, it will require, assuming pay at table, more equipment than chip and pin.. Or, a change in restaurant operation.
It will, put an end to skimmers.. Eventually.. because, remember, all cards for the next 2 years at least will still have mag stripes.
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