EMV is coming, does your fitness business need it?
EMV. Chip cards. Secure terminals. October EMV mandate! A lot of confusing terms are flying around in the merchant services and credit card acceptance space. What is EMV? It stands for Europay, MasterCard, and Visa, and it really just refers to credit and debit cards that have been secured with chip technology. You may have seen your own credit and debit cards replaced with a new card that has an embedded chip. With this chip, you “dip” the card into a slot equipped to read it, versus the old swipe method. Since the chip includes encryption and security data designed to prevent counterfeiting, this is in theory a more secure transaction.
So, the question is – do I need it? Well, here are the facts – because there are a lot of scare tactics going around trying to tell you that you need it. The fact is, EMV is not “mandated” until October of this year, and in most cases even terminals equipped with EMV slots aren’t ready for it. A few stores, like Walmart, have begun requiring you to dip instead of swipe if your card is enabled, but working EMV in retail is still not that common.
Once EMV is fully ready and mandated by Visa, MasterCard, Discover, and American Express, the difference is subtle. The mandate incorporates what is called a liability shift. Right now, if someone makes a counterfeit card with a magnetic swipe and normal 16 digit account number, and you follow card issuer procedures in verifying signatures, you *may* not be liable. I say “may” because there are a lot of caveats that can cause you to be liable anyway. Once the EMV mandate takes effect in October, you WILL be liable if you did not have equipment capable of handling an EMV transaction.
So, this brings up a few questions. How big of a problem is counterfeit card fraud for you now? In most cases, not very big. The other question is – as as a fitness related business, how often are you actually swiping a card in person? Probably not often. Most of your business is recurring billing and member accounts, so that is not really affected either. Eventually I can envision situations where new members are “dipping” EMV cards which are being stored securely in the cloud for recurring transactions, but those days are still a ways off. Right now the industry is scrambling to update retail equipment in time.
So, EMV is happening, and it is something you should think about but not worry about. If you don’t have equipment for your retail face-to-face business, just switch to Fitness Merchant Services and we will set you up with a compliant terminal 100% free!
Happy Fourth of July everyone! Be safe!