(Submitted by Melissa Carter, Business Development Specialist, Small Business Development Center, OSU South Centers)
In order to increase the security of your credit card purchases, credit card companies are moving away from the magnetic stripe technology on cards to cards with microchips. Chip cards are based on a global standard called EMV (Europay, MasterCard and Visa). The goal is to reduce fraud because it is harder to counterfeit or copy a card with the chip technology.
So what does that mean for your business? Businesses will have to purchase new Point of Sale (POS) terminals that accept the chip card. This means initial costs to upgrade your hardware but could save your business a lot of money and legal trouble in the future. After October 1, 2015, the liability for a credit card transaction that is determined fraudulent or counterfeit will fall to party in the “least EMV-compliant”. This means, that if your business does not have the capabilities to accept the chip cards, then the liability will fall on your business.
This technology is here to stay. Over 80 countries have already adopted the EMV and is a global standard. If you haven’t already implemented the EMV technology, your business becomes at risk for any future transactions.