This Sunday I was able to share with MSNBC Your Business about what retailers need to know in regard to the new “chip” credit cards.
Over 120 million Americans and businesses have been estimated to have gotten the new credit cards designed to use the electronic chip technology. The chip has been designed to help reduce credit card fraud, which has been a major issue in the US over the last few years.
Whenever a customer makes a purchase by scanning the chip on the card, a transaction number is generated randomly. Although a fraudster is capable of using the card once, they cannot copy the card’s unique electronic chip. However, since the card is still in a transition phase and features the old yet trusty strip of magnet at the back, the strip can be copied.
So, How Will the New Credit Card Cost Businesses?
Businesses are expected to buy the new card machines that can read the new EMV debit and credit cards based on the chip technology. The time it takes to process the cards and the possibility of fraud for those who haven’t embraced the chip cards are the two major issues businesses will have to face.
Businesses are more likely to increase the fees or prices of goods and services if they have to bear liability for any fraud that occurs. However, this liability should remain with the companies behind the credit cards at least until every consumer and credit card embraces the use of the chip technology.