Upgrading to EMV Reduces Fraud Liability and Boosts Customer Experience. Many small businesses operate on tight margins. That’s one reason they have been slow to upgrade their payment systems to accept EMV chip-enabled cards. Many are also stymied by the cost and complexity of the required changes.
Unfortunately, delaying can have expensive consequences.
October 2015 marked the deadline for small businesses to upgrade their payment systems. As the one-year anniversary recently passed, small businesses need to take a fresh look at what’s at stake.
The chip-card rollout has been bumpy for merchants, consumers and card issuers alike. But the reality is that small businesses have the most to lose. In fall 2015, liability for in-store fraudulent charges shifted to merchants from card issuers and banks.
If merchants accept a chip card in-store but run it as a magnetic-stripe card, they are liable if the card turns out to be counterfeit, stolen or compromised.
Yet many small businesses are unprepared. In the latest CAN Capital Small Business Health Index, 73 percent of small business owners said their current POS systems were not EMV compatible. Even with the potential to be liable for fraud costs, seventy percent of small business owners do not plan to invest in new payments technology in the next twelve months.