EMV Equipment: To Serve & Protect Your Business Against Chargeback Fraud
That has been the question since October 2015, and 10 months later most small to mid-size businesses still have not made the switch to new EMV equipment. While some reports have said it has to do with cost and others because the transaction takes too long or they will have to retrain their employees, the number one reason we hear is “it doesn’t affect me.” While this may be the case for a select few businesses, consumers and customers are also starting to catch on and understand the liability of EMV.
Say a customer walks into your store, restaurant, etc., whatever the case may be and they see you swipe their chip card, if they know how EMV works, they know that they can dispute the transaction and automatically win – just by seeing you swipe a chip card. Regardless of if the services were rendered or they walked away with merchandise – they can dispute the transaction and automatically win. Unfortunately you as the business owner will automatically take that loss. Now, think if 20 customers a month did this, it would add up.
This type of fraud is known as “chargeback fraud” – meaning they use the chargeback process as a way to receive a refund of a service or product they received. So, how do you protect your business against chargeback fraud? The number one way is to upgrade to EMV/chip card equipment. This protects you from automatically losing, we also recommend getting a signature and asking for the credit card verification code
Top Industries Targeted for Chargeback Fraud:
- Grocery Stores
Chargeback fraud is projected to cost businesses 5.8 billion dollars in 2016 and since the EMV rollout it has increased by 25%. Reports have shown that 50% of cardholders who get away with it the first time are likely to do it again within 90 days. The number is projected to decrease as more businesses upgrade to EMV equipment.