A guide to EMV chip technology
January 26, 2015

Due to the heightened demand for payment security, Europay, MasterCard and Visa, chips are altering the face of credit cards. This emerging technology cuts down on fraud protection expenses and protects your customers, according to Fox Business.

"These new and improved cards are being deployed to improve payment security, making it more difficult for fraudsters to successfully counterfeit cards," Julie Conroy, research director for retail banking at Aite Group, told Fox Business. "It's an important step forward."

Chip technology in the U.S.
Bankrate noted that EMV chip technology is becoming more common in the U.S. This change to credit card security is expected to alter much of the payment processing landscape. The embedded microprocessor chips require a signature or personal identification number when used to make purchases. This technology offers more security. While it has already been adopted in other parts of the world, U.S. banks are transitioning into using this modern technology.

EMV offers more security than magnetic strips
Fox Business relayed that a traditional credit or debit card with a magnetic strip contains personal information. If someone were to copy the strip, that individual would have access to unchanging personal information of the cardholder. However, an EMV chip produces a different transaction code for each payment, which makes it significantly more difficult for criminals to commit fraud.

Magnetic strips on credit and debit cards leave customers vulnerable. Luckily, requiring PINs for transactions and using EMV chips allows for greater financial security, according to NPR. The U.S. is slightly behind the trend, but it is slowly beginning to adopt the new development.

"That type of fraud won't be able to occur because the chip prevents someone from emulating a card that way," Kevin Yuann, director of credit cards at NerdWallet, told NPR.

Investing in EMV payment processing
While this technology is still relatively new, the switch to EMV chip cards is gaining steam. While the initial cost of investing in acceptance technology as well as the additional training and education needed for implementation, offering customers another payment processing option that provides security can ultimately benefit your business.

Stay informed on updates in emerging news regarding EMV chips and begin developing a plan for adaptation. Also keep in mind the importance and benefits of providing your customers with multiple payment options. Additionally, offering your patrons with increased security can build trust and loyalty between you and the consumer.

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