This is because whatever the information embedded in the mag stripe stays in the mag stripe-and always stays the same for every transaction.Īnd that means that any criminal who’s able to successfully clone your mag-stripe data onto another card can use this information over and over again until you end up going through the trouble of getting replacement cards. Mag-stripe card purchases might be simple and straightforward, but they’re also vulnerable to fraud. When these cards are swiped into an electronic credit card reader, the reader connects to a card authenticator program to authenticate and process the payment. The magnetic credit card stripe is divided into three different sections, with the first two containing multi-bit alphanumeric characters that store your card’s payment and transaction information. Although this bar may look plain, it contains complex information activated by magnetic iron particles. If you look on the back of your credit card or debit card-including current EMV cards-you’ll see a thick black stripe that runs over the top of it. To understand why EMV technology and credit card chip laws matter to businesses, it’s good to contrast how EMV cards work vs. The major credit companies introduced EMV technology and credit card EMV compliance regulations in response to rampant credit card counterfeiting and fraud incidents tied to traditional magnetic stripe-or “mag-stripe”-cards. How EMV Technology Works-and Improves Upon Existing Payment Technologies
įortunately, it’s not difficult to implement EMV into your business payment systems. According to statistics, only 50% to 52% of businesses currently support EMV chip card payments. E ven though major credit card companies requested most merchants do so by October 1, 2015, a relatively staggering number have not yet adopted procedures meeting credit card EMV compliance. Otherwise, you won’t be able to avoid liability under new credit card chip reader law.
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Here’s what you need to know about how credit card compliance law could affect your business-and what any consequences you could face for not updating your technology to follow the EMV rules.ĮMV compliance law stipulates that all businesses need to upgrade their point-of-sale (POS) systems to accommodate EMV chip cards and EMV compliance.
And that credit card compliance law, too-also known as EMV compliance law. With these new developments also come those shiny new physical credit cards you’ll need to accept as a small business owner (as well as ones you’ll be spending on with your own business credit cards). The technology behind it, however, is designed to not only cut down on consumer fraud, but also limit credit card and bank issuers’ liability for fraudulent payment chargebacks. Rather, it’s actually an acronym for Europay, Mastercard, and Visa-the three companies to pioneer this payment method. These squares are actually computer chips that are structured to accommodate EMV-the latest development in secure payment technology. Along with the futuristic look they add to any blasé black-striped credit card (nice!), they also come with higher-tech security-and EMV compliance regulations that all businesses must now follow to support it. Thanks to something called “EMV technology,” you’ve likely received new credit and debit cards in the mail sporting simple silver squares.