A Deep Dive Into EMV Chip Cards and Why They’re Important

***Updated: 8/16/19***

By now, every business owner has probably heard about EMV chip cards, but we still run into questions about them. So here are some basic facts about EMV chip cards.

What are EMV chip cards?

Chip cards are credit and debit cards with a small computer chip embedded in their plastic. EMV is an acronym for Europe MasterCard Visa, which established the global standard for these types of cards.

Why are they so important to my business?

EMV Chip cards are a way to improve security, reduce fraud and provide value-added products in the future. They have been deployed in about every country in the world, including the United States.

How do they improve cardholder security?

The computer chip can store information and perform a validation that is more secure than the magnetic stripe on the back of the card. Chip technology is more effective in combating counterfeit fraud than the magnetic stripe technology.

What do I need in order to accept an EMV chip card for payment?

There are two things that you will need to read a chip card at the point of sale. You will need a card reader that is enabled to read the EMV chip, and you will need EMV chip card software. Wind River has a variety of card readers that work with EMV chip cards.

Can I accept a chip card for payment today if I don’t have a chip card reader?

Yes, almost all credit or debit cards issued today will include both a magnetic strip and an EMV chip on the card. This is to help users be able to use their card at any merchant, no matter where they are in the transition process.

EMV Chip Card Best Practices

If you have one, insert the card into a hardware capable terminal, and follow the instructions on the terminal screen. You may be instructed to allow your customer to enter a PIN number. However, not every EMV chip card will require a PIN number, so it is important that you follow the instructions on the screen.

If you do not see instructions upon entering the chip card into the terminal, or you do not have a hardware capable terminal, run the card through the terminal using the traditional magnetic strip. Again, follow the instructions on the terminal screen.

Finally, if neither the chip card reader nor the magnetic strip reader successfully initiates a transaction, follow your fall back instructions for hand keying the transaction to complete the sale.

What is the the Liability Shift? Am I required to support EMV chip cards?

As of October 2015, Visa and Mastercard under went the Liability Shift. This means that the responsibility for some types of fraudulent activity now falls on the merchant if they merchant doesn’t accept EMV chip cards as a payment method. This was meant as an incentive for the card issuers and merchant to get on board with processing EMV/chip cards. Not accepting EMV can put you at risk for future fraud.

With that said, here’s the great news. Supporting EMV is incredibly easy to do, and that’s where Wind River can come in to help you.

Why do some merchants support EMV chip cards and some don’t?

Some merchants have been allowed a longer window to switch to EMV, such as the pay-at-the-pump industry. They have until 2020 to make the change. Others, based on their risk aversion and business needs, have taken a slower approach to changing. Again, this is where Wind River can help. We will make sure that you know what you need to know and, based on the needs of your business, set you up with the payment acceptance equipment that makes the most sense for you.