What is EMV and Why Does Your Restaurant Need It?

Written by  on 19 May 2015

With the rate of data breaches in the U.S. reaching a record high in 2014, concern for security is also peaking. Part of that concern may be mitigated by the implementation of EMV (Europay/Mastercard/Visa).

Although the cost of upgrading your POS system to include the EMV security standards might be frustrating, the implementation does include several benefits for your restaurant.

What is EMV?
EMV is a payment method that replaces the magnetic stripe on credit cards with an integrated circuit chip (ICC). The ICC contains the account number and other information needed for transaction processing. It has gradually been installed in other countries around the world, and its presence is now extending into the United States.

How does EMV increase security?
EMV makes it more challenging and, therefore, less enticing for thieves to counterfeit cards. The ICC installed on the card makes duplicating the information, which is traditionally stored in the magnetic stripe, nearly impossible.

Although EMV won’t actually prevent data breaches, any data that is stolen cannot be duplicated. This is because the ICC creates a unique transaction code every time it is used for payment. If a hacker were to acquire the code, he wouldn’t be able to use it again.

Further, EMV is compatible with encryption and tokenization, which can prevent the chances of a data breach. Encryption protects information between the card reader and the POS server. Tokenization then protects that information while it’s stored in a database or server by replacing customer data with a token. This token is meaningless to hackers but still allows you to perform sales reports and process returns. Combining this technology with EMV can help protect you and your customers.

What are the benefits of more payment options?

70% of credit cards will leverage EMV technology by the end of 2015. With this many card carriers using EMV technology, it will be necessary to implement EMV readers to accommodate guests.

Many of the EMV point of sale terminals also offer more payment options, including NFC (Near Field Communication). This allows customers to make payments using mobile wallet applications like Apple Pay or Google Wallet.

With that in mind, it doesn’t seem likely that MSR technology will disappear anytime soon. Canadian banks made the switch to EMV five years ago and are still issuing magnetic stripe cards.

Offering an array of payment options can provide customers with choice, increase their satisfaction, and, thus, increase your restaurant’s profitability.

What is the liability shift?
Beginning in October 2015, liability for fraudulent transactions will differ depending on whether or not you have installed an EMV option at your restaurant.

If you have not implemented EMV, you will be held responsible for fraudulent transactions committed on-site that could have been prevented by the use of EMV.

However, if you have an EMV option available, the liability for fraudulent charges falls on the card issuing company. Implementing EMV could save your restaurant the cost and stress of shouldering responsibility.

EMV equipment provides numerous benefits for your restaurant. With EMV, you can increase security and customer satisfaction while minimizing liability.

Read 619 times Last modified on Monday, 01 June 2015 18:50

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