Thursday, January 18, 2018

What Restaurants Need to Know about EMV Compliance

..We all witnessed the change from swiping to inserting our credit cards two years ago, but that transition is ongoing. Small businesses, and restaurants in particular, can be wary of adopting EMV technology for myriad reasons, including cost, process, and the pressures of adopting new technology. However, one concern stands out above the rest—security, and rightly so..
The Chip
..Whereas existing magnetic stripe technology continues to be prone to hacking, embedded chip cards are much safer, with near-impossible encryption to prevent against counterfeiting. Data is actually more secure than on a magnetic stripe card because EMV supports dynamic authentication. This means that the card has an ever-changing password of sorts encrypted within, making it vastly more difficult for hackers to access and copy the data. The United States is one of the last nations to adopt EMV technology, which is surprising considering how global credit card fraud has dropped significantly since worldwide implementation.
Liability
While the chip is the most visible change, many restaurateurs are also concerned about who the liability will fall to should there be fraudulent charges on their new EMV payments system.
Prior to EMV, credit card issuers were responsible for the liability in fraudulent chargebacks from customers. But, the liability ownership changed with the deadline for compliance. Now, should an EMV chip card be swiped as opposed to dipped, and concurrently a fraudulent chargeback is claimed, the business is liable for chargebacks above $25. If, however, you have an EMV reader, then the liability shifts back to the card issuer, and this remains true even if the chip is damaged.
Is the average check size above $25? – If a restaurant’s average check size is above $25, it should consider EMV more closely. For chargebacks above $25 when an EMV-enabled card is processed without an EMV reader, the liability shifts to the restaurant. In other words, without an EMV reader, a restaurant will likely be on the hook for most fraudulent chargebacks..
Stored Cardholder Data
..Traditional EMV processors will not effectively protect cardholder data at the point of sale, which means that the restaurant goers’ information is more susceptible. However, there are next generation POS solutions that utilize secure cloud processing technology to prevent this customer security risk. In other words, vulnerable cardholder data is stored in a way that denies access to third parties. Not even a data security expert at the POS providing company could access the data un-encrypted..Read more here

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