As a business owner, you have probably heard (or not) of the EMV Liability Shift that became effective in October 1st, 2015. Credit card networks like Visa and MasterCard instituted a liability shift in October to get merchants to speed things up on their end—either upgrade your terminals or you’re liable for any fraud that happens with a card that could have made a transaction using the chip technology. In other words, you are now responsible for any fraudulent transactions at your business if you have not yet upgraded to EMV.

Although EMV migration started almost 5 years ago with VISA taking the lead, with MasterCard, Discover, and American Express following suit respectively, a recent survey shows only 37% of retailers in the US can process chip-embedded cards (TSG Survey), even 6 months after the deadline for merchants to switch to EMV. This has lead to a large number of merchants (who have not upgraded) complaining about an increase of chargebacks at their businesses and finding themselves liable for those charges.

But what if we upgraded to EMV and still get hit with a chargeback?

  1. If your business is EMV-ready, always make sure to process cards with a chip by inserting the card and following the instructions on the terminal.
  2. If a chip card is declined, do not swipe or override.
  3. Never swipe or manually key in a chip card.
  4. Swipe non-chip cards, do not manually key in .

Because strip-cards are easily duplicated, the chances of fraudulent charges are higher, specially if your system is not EMV ready, therefore we, at US Payment Systems, recommend you upgrade your equipment as soon as possible. And we can help you with that. We work with retailers of all sizes and provide recommendations on what equipment best fits your business needs.

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Visa Milestones

  • August 9, 2011.  Visa announced plans to accelerate chip migration and adoption of mobile payments in the United States, through retailer incentives, processing infrastructure acceptance requirements and counterfeit card liability shift.
  • October 1, 2012 – PCI Audit Relief:  If more than 75% of merchant Visa transactions originate from EMV-compliant POS terminals that support both contact and contactless transactions, the merchant may apply for relief from the audit requirement for PCI compliance (but is still mandated to be PCI compliant).
  • April 1, 2013 – Acquirer Compliance.  Acquirers and sub-processors must be enabled to handle full EMV chip data in transactions.
  • October 1, 2015 – Counterfeit Card Liability Shift.  The party that has made investment in EMV deployment is protected from financial liability for card-present counterfeit fraud losses on this date.  If neither or both parties are EMV compliant, the fraud liability remains the same as it is today.  This date excludes automated fuel dispensers.
  • October 1, 2017 – Counterfeit Card Liability Shift, Automated Fuel Dispensers.  This extends the card-present counterfeit card liability shift to transactions from automated fuel dispensers.