Make sure your club is ready for the nationwide shift of new credit card standards. This is going to be bigger than 1999.
Ready or not, the world of payments is evolving and starting this October the nationwide shift to EMV will become regulation and impact your ability to protect your club from risk and fraud. Is your club ready for the new payment card standards that will begin to reshape how most customers pay for products and services?
EMV – which stands for Europay, MasterCard and Visa – is becoming the global standard for credit card and debit cards equipped with computer chips and the technology used to authenticate chip-card transactions.
Due to recent data breaches and increasing rates of counterfeit card fraud, U.S. card issuers are migrating to this new technology to protect consumers.
So, how will this new EMV credit card standard affect my club?
Your members will start receiving their replacement cards soon, if they have not already, so the switch to EMV means adding new in club technology and internal processing systems, and complying with new liability rules that will support these new chip cards, that’ll keep you, the merchant, from having to pay any unnecessary fees.
Something as drastic as changing your club’s POS system is going to raise questions. Fortunately, we have some answers, especially now that the deadline is around the corner. Here are five frequently asked questions to help you understand what you can expect from the EMV shift.
1. How are EMV cards more secure than traditional cards?
Well, that little magnetic stripe on traditional credit and debit cards contain unchanging data and whoever accesses that data gains the sensitive card and cardholder information necessary to make purchases. Unlike magnetic-stripe cards, every time an EMV card is used for payment, the card chip creates a unique transaction code that cannot be used again. EMV technology will not prevent data breaches from occurring, but it will make it much harder for criminals to successfully profit from what they steal.
2. Is my club required to support EMV?
At this moment, no you are not required to support EMV in the U.S. region. BUT, come October of this year you WILL BE REQUIRED to support this new technology. Just remember that even if high levels of card present fraud haven’t targeted your club in the past, you may be putting yourself at risk in the future. Therefore, you may want to ensure that all your terminals are EMV chip capable so you will be ready to accept these cards today.
3. What other incentives are there to accept chip cards?
It’ll save you some extra cash. The payment brands are doing their part to ensure that chip-bearing customers can pay at chip-enabled businesses. “Visa and MasterCard have issued upcoming rules and guidelines for processors and merchants to support EMV chip technology.
Visa is introducing their Technology Innovation Program (TIP) to the U.S. region, which waives an annual PCI-DSS audit if 75 percent of the merchant's Visa transactions are processed through a dual contactless and contact EMV certified device. MasterCard is introducing their PCI-DSS Compliance Validation Exemption Program to the U.S. region, which also waives the annual PCI-DSS audit if 75 percent of the merchants' MasterCard transactions are processed through a dual contactless and contact EMV certified device.” Saving money is always a plus.
4. Why should I invest in EMV chip card acceptance now?
Preventing the growth of fraudulent activity is one of the main reasons the industry is moving toward EMV technology- and this also includes the fitness industry. Chip cards make it difficult for fraud organizations to target cardholders and businesses alike. As a result, more and more chip cards are being introduced by U.S. financial institutions in order to support and switch over to this technology.
5. How am I impacted by the liability shift?
With the liability shift, if a chip card is presented at your club and you have not adopted a terminal that is certified for chip card acceptance, liability for counterfeit fraud may shift to your acquiring bank – who may then pass this fee back to you.
The liability shift encourages chip adoption since any chip-on-chip transaction (chip card read by a chip certified terminal) provides the dynamic authentication data that helps to better protect all parties. In addition, if a counterfeit magnetic stripe card is presented at a chip certified terminal, the liability for the counterfeit fraud will be the responsibility of the card issuer.
What if I have more questions?
Need a plan of attack so that your club is prepared for the EMV shift? Join us at IHRSA March 11, 2015 at 1:30PM for our “EMV Readiness” chat and hear from payment processing and data security experts on what it means for your point-of-sale and ecommerce systems, including your in-club hardware and websites and what you need to do to be compliant before October comes.