EMV Chips Driving You Crazy? Here’s Why You Can’t Do Without Them
What is EMV and what’s the point of it?
Just think of it like the band ABBA.
No, no, bear with me here. EMV technology is a bit like ABBA. After all, it’s an acronym built from the initials of its members (Europay, MasterCard and Visa). While a lot of people find it kind of annoying, you can’t deny that it’s brought together these different elements and made them work together in pretty impressive harmony. And it seems that ever since it stormed onto the scene, you can’t seem to go anywhere without hearing about them.
Yes, much like everyone’s favorite Scandi-pop quartet back in the day, EMV technology has come to dominate the industry at lightning speed. But unlike ABBA (I hope), this has less to do with how it's blonder members look in white flares and more to do with the powerful microprocessor chips embedded in credit/debit cards as well as devices like smartphones, which store and protect cardholder data.
Why Merchants Don’t Like Them
If EMV cards are the new gold standard, why aren’t all merchants using them yet?
Because it seems that the majority of US businesses still aren’t on board with it’s benefits. In fact, back in January 2016, just 37% of retailers had embraced the new chip and pin machines. In the US, 4 out of 5 machines weren’t yet set up to take EMV payments – or their owners weren’t willing to use them in this way yet.
The reasons for this aren’t entirely clear, but in the US, at least, a lot of this is seemingly down to bureaucracy. The main benefit of EMV technology is that it is amazing at reducing fraud, as we’ll talk about in just a moment. The problem is that there was a lot of talk suggesting that when fraudulent payments DID slip through the net, banks and card companies would try to shift the blame to the merchant instead. No one wanted to be liable, so people just refused to accept EMV – even though not accepting it made fraud more likely.
In all fairness, though, it wasn’t just the blame issue slowing down EMV uptake. The cards were released just as a wave of mobile payments like Apple Pay came to the fore, and many retailers were rushing to get themselves ready to accept these as well. Anything that changes how card payments are handled obviously takes a little bit of time and effort and many felt that this would delay business too much.
For others, the cost of the terminals is an off-putting expense, while in some cases, the terminals have been rolled out and ready to use, but the software isn’t yet installed or up to date. And, of course, there are always those merchants that dislike change of any kind simply because it’s change.
These were all initial hurdles to EMV adoption. Recently, though, enough time has passed to get accustomed to the system – and there really is no excuse for a business to drags its’ heels.
Why Merchants Need Them
Need them? What do you mean need them!?! Here’s the issue: no matter how reluctant you are, you NEED to accept EMV payments. You just do.
Why? Because they do absolute wonders for security. Visa found that cases of fraud at high-risk companies dropped by nearly a fifth in one year following EMV adoption. Most EMV transactions require you to enter a PIN, making it much harder to use stolen cards or make unauthorized transactions. Even without a PIN, having an EMV microprocessor makes a card very difficult to clone, reducing the fraud risk even further.
This stuff really works.
And strikingly, too, the opposite is also true. At businesses that have refused to roll out EMV, fraud rates shot up by 11% in a year. If you’re being stubborn about this, you’re opening yourself up to trouble.
Oh, and there’s more: by April of this year, 70% of cardholders had been issued EMV chip cards and that number is only increasing. This means the overwhelming majority of your customers have these cards and most want to use them because they’re safe and convenient! resisting will only annoy your client base - and that’s never a good thing, right?