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Why Small Business Shouldn't Stall on the EMV Liability Shift

April 26, 2017

While awareness and adoption are rising among businesses of all sizes in the United States, small to medium-sized businesses and very small businesses still lag behind. That delay could be costly, especially for merchants with less of a financial cushion.

You probably have some small-business clients yet to upgrade to EMV at the point of sale (POS). While their reasons for lack of action may vary, most fall into three camps:

   1)    Believe installing EMV card readers won't benefit their business

   2)    Don't see the ROI for costs associated with EMV upgrades

   3)    Not concerned with the EMV liability shift for fraudulent transactions

For smaller merchants, these concerns are real. But as more and more time passes without an action plan for becoming EMV-ready, these business owners are incurring increasing risk. Here's why:

Fraudulent activity finds the weakest link in the chain

You probably know that the 2015 EMV liability shift began the process of moving more financial responsibility for fraud from card issuers to merchants. For that reason, the larger Tier 1 merchants prioritized EMV upgrades at the POS.

As more consumers get replacement credit and debit cards, the number of "chip-on-chip" transactions (chip cards read by EMV terminals) will start to rise that much faster. That means that people attempting to commit fraud will avoid merchants with higher security protocols and will turn to those with lesser protections.

Consumer trust is easily lost

Take a look at some of the recent high-profile data breaches. None of these companies emerged unscathed, especially in terms of customer goodwill. Reduced brand strength translates into unusual customer turnover, lost revenue, and increased customer acquisition activities.

While many merchants don't believe their businesses are susceptible to significant fraud, just a few incidents could be enough in order to raise customer concerns. Because small businesses have a smaller margin of error, even limited security lapses could be very costly.

Fraud costs can outpace those of EMV upgrades


Playing the waiting game is risky and can impact a merchant's bottom line much more than simply investing in needed upgrades. Business owners without significant financial reserves could find themselves permanently out of business.

You can help clients that have so far ignored the EMV liability shift by getting the conversation started. Use your expertise and that of your partners in order to evaluate existing POS systems and create a plan for upgrading card readers and associated hardware and software.

By giving your customers a little push, you'll help them reap the benefits of POS solutions that offer improved functionality and higher security in this fast-moving business climate.

How are your small-business clients responding to the EMV liability shift?