Between July 2015 and June 2016, only 7% of all U.S. card-based transactions involved an EMV card. Over the next 12 months, this figure climbed to more than 31%.
These figures suggest is that although EMV (Europay, Mastercard, and Visa) cards have become ubiquitous in a short amount of time, there are still widespread misconceptions about what they offer. These misconceptions can cause headaches for retailers, as a customer’s unwillingness to adopt the technology means they need to maintain two separate payment systems.
In order to encourage the universal adoption of EMV technology, it’s important to be able to differentiate between the facts and the fiction. Common concerns regarding EMV are related to their perceived security and their complicated integration processes, but the truth is, the data just doesn’t support these fears.
Myth #1: EMV cards are less secure
One of the major issues people have with EMV cards is that they believe them to be less secure than magnetic stripes. Luckily, this isn't true. Unlike with magnetic stripe cards, transaction information is encrypted on EMV cards rather than the terminal, making these transactions innately more secure. Additionally, the chip in EMV cards creates a unique number every time a card is used, making it impossible for that number to be used a second time. So, even chip cards without an accompanying PIN number are more secure than magnetic stripe cards as information is encrypted at the point of sale.
According to Visa, merchants with EMV-enabled technology saw a 66% drop in fraud between 2015 and 2017, proving the security capabilities of this technology. Of course, EMV cards are not entirely immune to fraud, but they do eliminate a major source of risk and are inherently more secure than the chip-free alternatives.
Myth #2: EMV cards hurt merchants
In order to encourage EMV adoption, the payment industry has stated that liability for fraudulent transactions falls on whatever party is least EMV-compliant at the time of the fraud. For instance, if a merchant has not adopted EMV payments and a fake EMV card is used then the merchant is liable for any resulting costs. With EMV adoption trending for consumers, it is in the best interest of merchants to make the switch in order to avoid fraud liability. In this way, adopting EMV technology is likely to protect merchants, rather than harm them.
Myth #3: EMV cards require special terminals
Since chip cards still have a magnetic stripe, they can be used in any type of payment processing terminal, including those that are not EMV enabled. The payment process is therefore no different for the customer or the merchant. As EMV cards become the norm, expect terminals that only accept magnetic stripe cards to become much less common, leading to the phasing out of these machines altogether. The U.S. lags behind the rest of the world in terms of adoption, but parity is expected by the end of 2018.
Myth #4: EMV technology is complicated to integrate
Since it is in everyone's best interest to adopt EMV cards, there has been a concerted effort to make the attendant technologies as easy and accessible as possible. EMV integration will ensure a more secure payment experience for your customers as well as better peace of mind that your business and bottom line are protected. Isn’t that worth investing in? Ultimately, the protections offered by EMV reduce uncertainty and complexity for the merchant.
The final and perhaps most important misconception to dispel is that EMV is going away. Just the opposite is true, and soon this technology will be the international standard. Merchants are not legally required to implement EMV, however those that don't are falling behind while exposing consumers—and themselves—to heightened risk. Choosing to ignore EMV could prove to be a lose-lose situation for all involved.
iQmetrix is a leader in modern payment processing systems that make EMV is easy and ironclad as possible. Contact us when you're ready to catch up with the present and get in line with the future.
Photo Credits: Shutterstock / Rido, Shutterstock / Monkey Business Images, Shutterstock / 279photo Studio