LOS ANGELES — Big changes are coming to the domestic processing space on October 1, when the major credit card companies, MasterCard, Visa, Discover and American Express, will shift the liability for credit card fraud to merchants that are not EMV-compliant.
EMV-compliant credit cards use an RFID chip and a pin code for better security, and are also known as Chip-and-Pin cards, which are more advanced than the simple magnetic stripe currently used by most cards in the U.S. today.
“In these days of credit card fraud and identity theft, the United States has been behind the game in the prevention of credit card fraud when compared to the rest of the world, in that most credit cards issued in the U.S. continue to use encoded magnetic stripes to hold your data,” explains Mobius Payments CEO Mia Hyun. “These stripes can be scrambled, erased or copied — the data can even be stolen while the credit card remains in your wallet.”
According to the company, Mobius Payments specializes in high-risk merchant accounts in the U.S., EU, and Asia, offering comprehensive, cutting-edge electronic payment processing solutions for products and services. Mobius Payments features a fully secure end-to-end global payment solution supporting all major credit cards, 36 global currencies, a variety of integrated shopping carts, ACH, and a wide range of custom solutions.
Hyun notes that if a retail customer uses a magnetic swipe card and it is a fraudulent transaction, the merchant is not liable, and the card issuer will still be responsible for the loss — but the status quo is about to change.
“If however, the consumer is using a chip card, but the merchant is not using a terminal that accepts the EMV technology — and it is a fraudulent transaction — then the merchant will be found liable because the card issuer invested in the Chip-and-Pin technology but the merchant failed to upgrade to this more secure technology,” Hyun says. “[Although] if a fraudulent transaction is made with a chip card at a chip terminal, then the card issuer is responsible.”
Hyun notes that one good thing about EMV is that in-store credit card fraud is virtually eliminated when both parties are using the Chip-and-Pin technology.
“The fact of the matter is that EMV technology may be new to the United States, but it is the standard pretty much everywhere else in the world, and it will be the standard here soon,” Hyun says. “By the end of 2015, every merchant, ISO/MSP (Independent Selling Organization / Member Service Provider) and bank will have to be prepared to manage this transition because responsibility for fraud can shift from the card issuer to the merchant.”
With these new changes coming to the merchant space, many companies are now wondering if their business is EMV-compliant, and seeking knowledgeable processing partners such as Mobius Payments that can help them achieve this goal of becoming capable of accepting EMV transactions. This includes retail brick and mortar business that use a credit card terminal — as well as companies with a business model that deals solely with online transactions.
“Time is running short,” Hyun concludes. “Mobius Payments is ready today.”
For more information, visit MobiusPayments.com.