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Click here to schedule an appointment with a Sales RepresentativeOctober 2015: The End on the Swipe-and-Sign Credit Card
Imagine Merchant Solutions is offering a FREE terminal upgrade to all merchants who qualify for our program. We will also reduce your rates and fees on your processing and help your business become compliant with the regulations set forth by the card issuing banks. To learn more about our program contact us (866) 924-2030 option 2
It’s a payment ritual as familiar as handing over a $20 bill, and it’s soon to go extinct: prepare to say farewell to the swipe-and-sign of a credit card transaction.
Beginning October 2015, you will stop swiping the credit card. Instead, you will insert your card into a slot, just like people do in much of the rest of the world, where the machine will read a microchip, not a magnetic stripe. You’ll still be signing for the time being, but the new system also enables the use of PIN numbers, if card issuers decide to add them to their cards.
The U.S. is the last major market to still use the old-fashioned swipe-and-sign system, and it’s a big reason why almost half the world’s credit card fraud happens in America, despite the country being home to about a quarter of all credit card transactions.
The recent large-scale theft of credit card data from retailers including Target, Neiman Marcus, Home Depot, Staples and others brought the issue more mainstream attention, leading to a Senate Judiciary Committee. Executives told the senators that once the country transitions to the new system which includes credit cards embedded with a microchip containing security data these kind of hacking attacks will be much more difficult to pull off.
The shift is coming though: both MasterCard and Visa have roadmaps for the changeover, and both have set October, 2015 as an important deadline in the switch. But why has it taken this long, and how will the changeover work for card users and businesses?
Part of the October 2015 deadline in our roadmap is what’s known as the ‘liability shift.’ Whenever card fraud happens, we need to determine who is liable for the costs. When the liability shift happens, what will change is that if there is an incidence of card fraud, whichever party has the lesser technology will bear the liability.
So if a merchant is still using the old system, they can still run a transaction with a swipe and a signature. But they will be liable for any fraudulent transactions if the customer has a chip card. And the same goes the other way – if the merchant has a new terminal, but the bank hasn’t issued a chip and PIN card to the customer, the bank would be liable.
The key point of a liability shift is not actually to shift liability around the market. It’s to create co-ordination in the market, so you have issuers and merchants investing in the migration at the same time. This way, we’re not shifting fraud around within the system; we’re driving fraud out of the system.
EMV http://en.wikipedia.org/wiki/EMV
NFC http://en.wikipedia.org/wiki/Near_field_communication
Apple Pay http://en.wikipedia.org/wiki/Apple_Pay
(866) 924-2030 - option 2
or contact us by email info@imaginemerchant.com
It’s a payment ritual as familiar as handing over a $20 bill, and it’s soon to go extinct: prepare to say farewell to the swipe-and-sign of a credit card transaction.
Beginning October 2015, you will stop swiping the credit card. Instead, you will insert your card into a slot, just like people do in much of the rest of the world, where the machine will read a microchip, not a magnetic stripe. You’ll still be signing for the time being, but the new system also enables the use of PIN numbers, if card issuers decide to add them to their cards.
The U.S. is the last major market to still use the old-fashioned swipe-and-sign system, and it’s a big reason why almost half the world’s credit card fraud happens in America, despite the country being home to about a quarter of all credit card transactions.
The recent large-scale theft of credit card data from retailers including Target, Neiman Marcus, Home Depot, Staples and others brought the issue more mainstream attention, leading to a Senate Judiciary Committee. Executives told the senators that once the country transitions to the new system which includes credit cards embedded with a microchip containing security data these kind of hacking attacks will be much more difficult to pull off.
The shift is coming though: both MasterCard and Visa have roadmaps for the changeover, and both have set October, 2015 as an important deadline in the switch. But why has it taken this long, and how will the changeover work for card users and businesses?
Part of the October 2015 deadline in our roadmap is what’s known as the ‘liability shift.’ Whenever card fraud happens, we need to determine who is liable for the costs. When the liability shift happens, what will change is that if there is an incidence of card fraud, whichever party has the lesser technology will bear the liability.
So if a merchant is still using the old system, they can still run a transaction with a swipe and a signature. But they will be liable for any fraudulent transactions if the customer has a chip card. And the same goes the other way – if the merchant has a new terminal, but the bank hasn’t issued a chip and PIN card to the customer, the bank would be liable.
The key point of a liability shift is not actually to shift liability around the market. It’s to create co-ordination in the market, so you have issuers and merchants investing in the migration at the same time. This way, we’re not shifting fraud around within the system; we’re driving fraud out of the system.
EMV http://en.wikipedia.org/wiki/EMV
NFC http://en.wikipedia.org/wiki/Near_field_communication
Apple Pay http://en.wikipedia.org/wiki/Apple_Pay
(866) 924-2030 - option 2
or contact us by email info@imaginemerchant.com
