A guide to EMV transactions: How to get started

By Angie Jonas
Published on November 9th, 2016

An EMV card.

Guest post from DishOut, our partner for PCI-compliant and EMV payment processing.

“Chip or swipe?” As a business owner or consumer, this phrase has worked its way onto the list of things that we hear, or say, on a daily basis. Frustration has mounted among consumers as they have encountered merchants in various stages of transitioning from accepting swipe-based card payments to EMV-based payments. The transition, new terminology, and a new way of paying for goods and services may seem confusing, but it doesn’t have to be. Check out our quick guide to EMV below to help you better understand and prepare for your transition.

What exactly is EMV?

EMV, or “chip cards” stands for Europay, Mastercard, and Visa, and is named after the three organizations who developed the standard. EMV cards use a computer chip in the card to encrypt card and bank data to transmit payment information, making payments more secure than the traditional magstripe found on the back of most credit cards.

What is the process for adopting EMV?

The process for adopting EMV technology in payment processing is long and complex; but for good reason, ensuring your financial security. Payment processing software is certified in conjunction with a specific hardware device, which is then certified to a specific processor and then every specific card type (e.g. Visa, MasterCard, American Express, Discover). If a merchant has a hardware device that does not have EMV capability, they must acquire a new hardware device, and learn the new process of inserting, commonly referred to as “dipping”, a card instead of swiping it.

I hear a lot about fraud liability shift. Why?

EMV payments have existed in Europe and Canada for quite some time, while the United States has been slower to adopt the new standard. As a result, it is estimated that half of the world’s fraudulent transactions occur in the United States. With EMV transactions, bank and payment information is encrypted and more secure. This additional security means the transactions a merchant may be liable for have changed. Liability for fraudulent transactions can be complex and discussed with your individual processor and/or bank, but in the most simplistic form:

  • If a customer’s card only has a magstripe, and is swiped as normal, it is likely the merchant won’t be liable for any fraudulent charges
  • If a customer’s card has an EMV chip and is dipped properly, it is likely the bank will be liable for fraudulent charges
  • If a customer’s card has an EMV chip and is swiped, there is a greater change the merchant will be liable for fraudulent charges

What if I still need some help?

If you would like additional information about what EMV payments are or the potential impact to your business, or a free evaluation of your EMV needs and potential conversion process, please contact DishOut at info@getdishout.com or (631) 657-0103.

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