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What U.S. Merchants Need to Know About EMV

December 29 2014 | By Pam Mukiama

While Canada and other parts of the world have already implemented EMV and seen considerable reduction of fraud at the point-of-sale, the U.S. has been slow to adopt this technology. Today, however, Merchants, financial institutions, and every other organization with a stake in the electronic payments process want to understand what EMV is, how it works and what the benefits are of making such a significant change to the U.S. payments system.

What is EMV?

EMV is a global standard for credit and debit card processing designed to replace magnetic stripe cards. Also referred to as chip and PIN or chip and signature, this smart chip technology consists of a microprocessor embedded into payment cards and smart devices such as mobile phones.

What Kind of Merchants will be Affected by EMV?

In an effort to expedite EMV migration in the U.S, the card brands have instituted deadlines, including the fraud liability shift of October 1, 2015. Merchants of all sizes, from small single location business owners to multi-location nationwide merchants, will all be affected.

The fraud liability shift stipulates that the party who does not support an EMV transaction will assume liability in the event of counterfeit fraud. Therefore, merchants who do not have a point-of-sale terminal that can accept and process EMV chip cards will be held liable for any resultant chargeback's or fraudulent transactions.

What should Merchants do to Prepare for EMV?

Merchants need to upgrade their point-of-sale terminals to EMV compliant models. While they have until October 1, 2015 before the fraud liability shift takes effect, there are advantages to making the upgrade right away. Many banks have already began issuing EMV chip cards to their customers and the merchants who are able to accept these cards will become the go-to choice for these security conscious consumers. While the magnetic stripe can still be used to authorize transactions, the security benefits of an EMV chip card make it the better option for both merchants and their customers.

What are the Benefits of EMV Chip Technology?

EMV provides better protection from fraudulent activity such as skimming and the creation of counterfeit cards. Cards based on the EMV standard use an embedded microprocessor (chip) instead of a magnetic stripe to store cardholder data. This chip is able to encrypt transaction data dynamically giving each transaction a unique stamp and making it almost impossible to skim. The chip also allows the POS terminal to authenticate the card making it harder for fraudsters to use counterfeit cards.

EMV chip technology also allows for the global interoperability of payment cards with POS terminals and ATM's. This means that cards issued in the UK can be accepted in the US and vice versa thus creating a better shopping experience for the traveling consumer and increased sales for EMV ready merchants!

The Pivotal Advantage

Pivotal Payments, having already participated in the successful migration to EMV in Canada, is uniquely positioned to work with U.S merchants as they prepare to migrate to EMV. Pivotal has over 5 years of EMV product experience, technical expertise in all implementations of EMV, plus EMV ready technology including stand-alone point-of-sale terminals and integration software. Backed by a team of client care and support staff who are knowledgeable in all aspects of EMV, Pivotal is the kind of partner you need to ensure your migration to EMV is smooth and successful!

For U.S merchants who need assistance with, or additional information on EMV migration, please contact us at: 1-877-441-4729

To all our readers, please forward this article to any U.S merchants you know who would find this information valuable.

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