Merchants should get ready for EMV credit cards in 2015

The aging, magnetic-stripe credit cards are being replaced by EMV, a new standard with an embedded microchip that stores encoded user credentials with an optional PIN.  These two capabilities combine to reduce fraud by making EMV cards harder to clone and more difficult to use if stolen.

However, retailers and other merchants will need to upgrade credit-card processing hardware to comply with EMV.  Plus, validation and payment approval occur in separate, consecutive steps, which may require rewrites to existing Point-of-Sale (PoS) software.

Other considerations for retailers and merchants:

  • Cards are dipped, rather than swiped, which slows the process
  • EMV-processing applications/certifications takes time; apply early
  • PINs can enhance security, but at the cost of being slower to process
  • Training staff will be necessary for high-volume, credit-card processors

After October 15, 2015, many credit-card issuers (MasterCard, VISA, etc.) will not cover fraudulent issues generated with non-EMV cards; a not-so-subtle statement on complying with the EMV standard in 2015.