EMV Liability Shift Happening this Thursday, October 1

Per last year’s Executive Order, the shift for businesses to be EMV compliant goes into effect this Thursday, October 1. There has been a lot of confusion about what exactly the shift means for businesses and whether the switch to accept EMV is mandatory or not. Please read below to understand the basics of EMV compliance and what it means for you right now.

Is accepting EMV actually required beginning this Thursday?

The switch to EMV is not technically mandatory beginning Thursday; there is no fine or legal requirement to switch to become EMV compliant. However, beginning Thursday, the business will now be liable for fraudulent charges instead of the credit card companies.

What does liability for not accepting EMV look like? 

If someone has an EMV chip in their card and you do not accept EMV, you are now taking responsibility for that transaction. This means that if that purchase is fraudulent, you will have to cover the expenses of that transaction. If someone does not have an EMV enabled credit card, the liability for those transactions still falls on the credit card company.

Is Chip & Signature the same thing as Chip & Pin?

No. Chip & Signature is a hardware system that dips the EMV enabled chip, but then requires a signature instead of a pin. Chip & Pin is the most secure transaction, and is the only one that is in full compliance with the October switch. While Chip & Signature is more secure than a traditional swipe, fraudulent charges will still fall on the business for those transactions.

Are all POS systems ready for the upgrade? 

No. We have heard from many different restaurants that their POS companies have said that they do not yet have EMV compliant options. Because the switch is still so new in the United States, these companies have not yet developed the proper equipment to handle the shift. If your business is committed to being fully compliant pursuant to the liability shift on October 1, POS company Revel Systems has fully compliant options available and will lease hardware for a monthly fee.

What are the major changes with the new Chip & Pin technology?

EMV technology utilizes a new chip that is dipped, instead of the traditional strip that is swiped. The dip takes several seconds to read. The major issue with EMV technology is the fact that in the case of Chip & Pin (not Chip & Signature), cards cannot be double-dipped, meaning the final amount must be input before the card is dipped. This makes tipping on the card not possible. The other challenge with Chip & Pin technology is that the customer must physically be present to enter their pin, making the payment system a huge challenge for full-service restaurants. Companies like Revel have created mobile devices that can be used table-side, but they come at a significantly higher price than the stationary systems.

Are all businesses switching to EMV by October 1? 

No. We have heard from a majority of our members that they are not switching to EMV for a variety of reasons. Some say the new upgraded POS systems are too costly, or don’t work for their restaurants. We have also heard from many people that their POS partners have told them they do not have the available software, so they are not able to upgrade at this time.

We will continue to give out information on EMV compliance as it becomes available. If you have any questions, please email Samantha Higgins.

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