Chargeback changes with the Mastercard Dispute Resolution Initiative
Retailers in the United States have been aware of EMV and its associated liability shift for a while now. But the truth is many still have a long way to go to replace their entire point of sale infrastructure to be EMV-compatible.
Recent data shows only 59% of retail locations and 50% of cards will be EMV compliant by the end of 2015 (a number that some feel is optimistic). And a survey by TSG predicts EMV-readiness will not reach 90% until 2017.
At Adyen, we have a deep expertise with EMV, and have been assisting customers in Europe and beyond with setting up EMV infrastructure and processing transactions for years.
If you are currently working on your EMV strategy, let this post serve as a guide to give you all of the facts (and benefits!) of EMV and how Adyen can help.
EMV is not just a more secure means of accepting payments. It is a mechanism of offering broader commerce experiences.
Let's take a look at some of the opportunities:
Eliminate POS fraud: EMV was designed specifically to prevent fraud at the point of sale - which it does. In Europe card-present fraud rates have been reduced by 80%.
And smart retailers are seizing the opportunity to provide a cutting-edge checkout experience. Contactless payment mechanisms are built on the EMV rails, so switching will keep you ahead of the payments curve.
Sync your physical store with your webshop: With an omnichannel solution you can provide a consistent customer experience across all sales channels, whether your shopper is online, on their mobile or in your store.
Furthermore, by consolidating all your sales channels into a single integration you benefit from a 360-degree view of your shoppers.
This means you can provide new shopping experiences such as endless aisle, in-store purchases on a tablet-based kiosk, personalized marketing and much more.
Well, the most talked-about is the liability shift.
As of 1st October 2015 the liability for fraudulent transactions shifts to whoever is least EMV compliant.
This means that if you do not have the hardware or software to accept chip cards, you will become liable for all costs and fees associated with the fraud.
Additionally you should consider the following:
POS terminal replacement: Replacing POS terminals with EMV-enabled ones incurs a one-time cost per terminal, In addition, there will be software, maintenance and training costs.
Staff training: Cashiers and other staff members should be ready and willing to help customers adapt to the new way of paying.
Online and telesales fraud: POS used to be an easy target for fraudsters. By making it harder to commit fraud at the POS, fraudsters will migrate to other channels. To combat this, you must ensure you have sufficient fraud prevention measures in place across all your sales channels.
Tokenization: Most of the breaches we have seen with US retailers in the past years were made possible because card data was processed and stored by merchants.
To preserve functionality such as recurring payments and shopper recognition, you should move to tokenization - something that is built into Adyen's platform.
Smart retailers are seizing the opportunity to provide a cutting-edge checkout experience.
Adyen’s platform has been EMV-compliant from the start, and is in line with the latest security standards. Adyen is fully capable of handling all EMV transactions, regardless of the required cardholder verification method (CVM).
With Adyen you are not required to be EMV certified, and do not need full PCI certification. All of Adyen-provided terminals are encrypted, so you can be sure your customers’ payment data is secure.
And with our global payments platform, you have a unified view of all transaction data across all geographies and channels, so you benefit from comprehensive global conversion analytics and unified commerce.
We have a wide range of point of sale solutions to fit business needs, providing a variety of EMV-enabled terminals to cover multiple use cases, from traditional payments at counters to mobile point of sale (mPOS) or endless-aisle scenarios.
Our terminals can run in standalone mode or integrate with any traditional cash register, cloud/SaaS Point-of-Sale, and mPOS systems.
EMV represents an enormous opportunity for retailers. While there is some associated expense, the benefits far outweigh the costs.
The key to success is a payments partner capable of keeping you up-to-date with the latest regulations, and innovations in payments.
With this you will be able to deliver a frictionless checkout experience, safe in the knowledge your customers’ payment data is secure.
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