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It's finally time to complete the U.S. EMV migration

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When you move into a new home, some of the first things you install likely include fire extinguishers, smoke detectors and a security system. When you change jobs, getting on your employer’s health plan is probably one of your first moves. When you buy a new vehicle, you are required to insure it against risk or theft and may choose to add an extended warranty against failures or defects.

Why do we bother to do any of these things? It’s for our own protection — because all of these safeguards reduce our own liability and bring us peace of mind that, should a worst-case scenario occur, we won’t be completely on the hook financially.

This is how merchants and retailers should think about ensuring they have EMV chip readers at all point-of-sale systems, including the forecourt: They are for the protection of you, your customers and your bottom line, because they help prevent credit card fraud.

The chip in EMV cards performs cryptographic functions, so account information stored on cards is individually encrypted every time it is accessed — versus traditional debit and credit cards, which statically store data in their magnetic stripes.

This enhanced security helps reduce fraud involving card-present transactions, specifically what’s known as “skimming.”

Traditional debit and credit cards are easily skimmed, allowing bad actors to produce a copy of the card with the customer’s information in the magnetic stripe. Credit-card skimmers are such a problem that the U.S. Secret Service has been enlisted to investigate and stop them: Earlier this year, a federal investigation found card skimmers on gas pumps across the Northeast collected almost 5,700 credit and debit card account numbers.

Using EMV chip readers also protects merchants and retailers from the full liability of fraudsters who buy products with counterfeit cards. The liability for counterfeit fraud falls onto the party in the payment chain with the least secure payment technology — either the card issuing financial institution or the merchant.

Because all major card schemes have adopted EMV chip technology, merchants who haven’t updated their POS systems or payment terminals to EMV are responsible for the costs stemming from fraud, like chargebacks. It can also be argued that savvy fraudsters will target merchants who haven’t enabled EMV, because they know they have a better shot at getting away with fraud.

To ensure safe, secure transactions that are protected against fraud, retailers moving to EMV have been encouraged by their POS partners to replace or upgrade the network infrastructure that connects purchases at terminals with bank accounts and payments processors to newer technology.

In some cases, like for the EMV migration at automated fuel dispensers, this is likely to be compulsory. For the fastest, most secure payments technology, look for end-to-end managed network service provider solutions with always-on connectivity, and 24/7/365 fraud monitoring for not only the payment devices, but also the connection itself.

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