Upgrade to new credit card technology to avoid liability
Starting October 1, all retailers, including auto dealers, could be liable for credit card fraud damages if they have not upgraded their credit card technology to accept a new type of card. The new cards, known as chip cards, are embedded with an anti-fraud computer chip that makes the information on the card much harder for a thief to steal and clone onto a new card.
Chip cards are based on a global card payment standard called EMV (Europay, MasterCard, Visa), used in 80 countries, according to the Small Business Administration. Credit card fraud has dropped significantly in those countries, and the U.S. is migrating to the new technology.
Although no law requires merchants to adopt the new technology, liability for credit card fraud shifts from the credit card issuers to retailers as of October 1. After that date, any dealership where a chip card is used but the store has old credit card technology can be held liable for fraud. To acquire an EMV-compliant processing device, check with your payment services provider.
The SBA and Square, a credit card processing service, are offering a free webinar for small businesses on October 14 at 2:00 p.m., EMV 101 – What Small Businesses Need to Know about the Switch to Chip Card Technology. Topics include what the transition to EMV chip card technology means for small businesses; what EMV chip card technology is and why itês more secure, and how to prepare for new fraud liability rules affecting merchants starting October 1. Registration is free but required. Click here to register.Download Bulletin PDF