October will soon be here and the Payments Liability shift is due to take place in the US.
As global losses due to financial fraud steadily increase and other countries explore banning magnetic stripe cards, there seems like no better time for retailers and issuers to make the switch.
However the cost to switching can be onerous especially to small businesses. Also the ability to protect against losses from fraud is debatable, as more transactions do not require a card present (mobile payments/online purchases). These realities may slow the adoption/implementation of EMV.
Moves by retailers and banks to support chip-enabled credit cards and adopt the EMV standard—short for Europay, MasterCard and Visa – has been driven by an October 2015 deadline. At that time, liability for fraudulent transactions will shift to whichever party – the card issuer or the merchant – has the lesser technology. A retailer could run a traditional swipe and sign transaction, for example, but be held responsible for fraud costs if the customer used a chip-enabled card. A massive data breach at Home Depot Inc.HD -1.59% prompted the retailer to speed up its implementation of chip-reading credit card terminals. Major credit card companies, too, have announced they will accelerate efforts to bolster electronic payments security and protect sensitive customer data.