The new system of card payments that will protect you from fraud

Dec 4th 2015 at 4:14 AM

EMV is an acronym that stands for a globally accepted system for processing payments which include visa, Europay and MasterCard. EMV sets the global standards involved in transactions with cards that are fitted with computer chips. As more and more transactions get conducted through cards, the business world is experiencing more instances of data breaches, counterfeiting and card fraud. This has propelled card issuers to migrate to EMV in order to protect their customers and reduce fraud. The new cards have been improved to cater for security during payments, thus making it hard for fraudsters to defraud customers. This is good news and a step in the right direction for anyone dealing in card payments. This also means that merchants and financial institutions will need to upgrade their technology and payment systems in order for them to comply to the rules regarding liability that comes with using the improved EMV systems. Consumers will also need to switch to using new cards and learn how to go about transacting with the new payment process.

What makes EMV cards secure as compared to older cards is the presence of the metallic square available on the cards. The square is a computer chip. Older generation cards were fitted with magnetic stripes, which store data that’s unchanging. Due to this, anyone who gets hold of a card will have access to sensitive information for the card and even cardholder details that are required for making transactions with the card. This makes these old cards target for any counterfeiter who wants to access cash using stolen cards. In fact, a counterfeiter using a card with a magnetic stripe can use the card many times, because the data in the stripe doesn’t change. That’s what makes EMV cards a much more preferable ecommerce payment gateway because the computer chip in the card creates a different code that changes with every transaction. This means that if a counterfeiter mines the card information from a specific PoS, it will be impossible for the card to be put to fraudulent use because that code will not be used again which means the transaction will not go through. One thing to note is that though EMV are safer and will reduce instances of card fraud, it doesn’t mean that your business and customers are completely protected from data breaches, therefore there’s still need to be extra careful with customer data information.

The process for making EMV payments involves two steps, just like with the old cards. The first step is card reading and the second one is verification of transaction. But unlike the older cards with the magnetic stripe, you don’t need to swipe a card. Instead, the card is read and processed by dipping into a slot. It’s during this dipping process that legitimacy of the card is verified and a unique code for that specific transaction created. The process takes longer than the swiping. Transactions can also be completed using NFC, whereby the card is tapped on the scanner, perhaps during a credit card payment, for the transaction to be completed.

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