EMV and the Liability Shift

As the payment processing industry moves to comply with the new October 2015 EMV standards, many merchants have expressed concerns about the shift in liability and circumstances in which they’ll be responsible for fraudulent transactions.

This article provides an overview to help merchants better understand and prepare for these changes in the payment processing industry.

As a current client of Century Business Solutions, your business operates under one of the following 3 scenarios:

  • Uses integrated payment processing through an integrated solution for an ERP/accounting/billing system and uses our virtual terminal to store and process your customers’ credit cards. Your business does not have a storefront and does not accept cards from customers in person.
  • Processes payments via our virtual terminal AND physical terminal(s) by swiping customers’ credit cards in your business store front
  • Processes credit cards via a physical terminal only.

Liability and Your Business

You are NOT liable:

If your business only uses our integrated payment processing integration to save card information and process cards inside an ERP/accounting/billing system and never handles actual cards. EMV will NOT affect you or your business, and you’ll NOT be liable for any transaction frauds arising out of the new rules on EMV.

You ARE liable:

If you are a merchant with a business storefront or use physical terminals to swipe credit cards. You’re only liable if you are presented with a chip card and you do not have an EMV enabled terminal to read the chip-embedded card.


How to Avoid Liability if you Use Physical Terminals to Accept Payments

If you process customer credit cards in person and manually swipe the cards, it’s time to upgrade to new EMV terminals. Accepting cards through an EMV enabled machine (if you have a storefront) is the only way you can avoid liabilities in the event of fraud in terms of the new EMV guidelines.

Does Century offer EMV Card Readers?

Yes, businesses that have not yet integrated their accounting or billing software with our gateway, who only need a physical terminal for processing will receive an EMV enabled machine to process chip cards.

However, businesses that use integrated payment processing software along with physical terminals to process transactions through our gateway, will need special card readers. These machines are programmed to facilitate the transfer of information between the terminal and gateway. At this time, payment industry is in the final stages of certification for these devices. In the meanwhile, merchants can use our other EMV enabled machines (on a temporary basis and outside of our gateway) until certification is complete.

Please note: Since most Century Business Solutions clients use our integrated payment processing to process cards through their software, the new EMV related rules do not directly affect their businesses.

Handling Physical Cards is the Only way Your Business can be Exposed to Liability if:

A customer hands you a chip card, AND you process the card through an old mag-reader terminal, AND the customer files a dispute (chargeback), AND in lack of other evidence to establish the legitimacy of the transaction- it’s proved that you did not have the necessary equipment to read the chip card.

For more information, please contact us at 1-888-500-7798.