Retailing in a Post-Liability Shift World: 5 Questions (and Answers) about EMV

The EMV liability shift in the U.S. has finally taken place. Depending on how aware and prepared they were, businesses are experiencing varying levels of impact on their day-to-day operations.

Those that haven’t upgraded their systems for EMV compliance yet should not panic, but they still need to think about future proofing their systems — and they need to be ready to address customer questions.

Below are some common, post-shift questions from merchants.

What’s an effective way for businesses to take advantage of the EMV upgrade cycle?

Some payments providers have developed single-terminal solutions that accept EMV (chip and pin as well as chip and sig), near-field communication (NFC) and mag-stripe cards. If you don’t already have an upgraded, lower-cost, higher-customization tablet-based solution, this is the time to upgrade. The shift is an excellent opportunity for retailers to upgrade and modernize their point of sale (POS) systems with the latest technology that enables them to sell online, on mobile and in-person — all with the same account. Future-proofing with a solution that already accepts multiple forms of payment is key to being prepared for new technologies, like contactless payments.

What’s the benefit to making mobile payment acceptance a priority, in conjunction with EMV?

The high-value benefit from fraud protection is adjoined by the additional incentive of being able to accept NFC and other relevant mobile-based payments. It’s easier and more economical to make mobile payment acceptance a priority when it’s paired with the cost of EMV upgrades. We all know mobile payments are going to be big. It’s just a matter of when. IDC predicts that payments made over mobile networks will reach almost $4 trillion in 2020. So why isn’t it happening more quickly? Well, small businesses tend not to have the time or the resources to look for the latest and greatest in POS systems, even if EMV liability is the cost. But for many, the EMV liability shift and the waived PCI compliance fees will be a strong incentive to upgrade.

What will happen to merchants if they don’t upgrade their systems?

With the liability shift in place, merchants are determining what their fraud risk may be on a case-by-case basis – so when and how to switch to an EMV-compliant system can differ between retailers. But the general consensus is that merchants need to astutely examine their fraud risk and become compliant as soon as possible to protect their business and their customers.

Now that more payments hackers are shifting their attention from card-present to e-commerce fraud, how can retailers protect their businesses online?

It’s true that payments hackers and fraudsters are speedily moving online – as more shoppers move online, fraudsters are following. Businesses can save money and improve sales by continuing to strengthen their payments security, especially in their online and mobile channels. To make sure businesses are protecting themselves while also getting the ability to capture additional value from improved security, they should work with trusted payments partners like PayPal that make security a top-priority – and develop a comprehensive, card-present and card-not-present security plan.

What resources are available to merchants if they want to learn more?

When it comes to EMV, retailers don’t have to go it alone – they should turn to trusted payments partners who have the expertise and resources to help guide them through the transition. Beyond EMV, payments partners can help merchants keep up with their customer base, adopting technology that helps make the entire payments process seamless for shoppers.

The EMV shift is not something to be feared, and it’s not too late to become compliant. Rather, EMV is an excellent opportunity to make sure your POS system is secure and future-proofed.

Xin Ge is Vice President of Seller Risk for PayPal

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