EMV Chip Card technology is the new industry standard in the U.S., as it makes the acceptance of card present payments more secure. The New Standard of Protection EMV Chip Card Technology EMV PROTECTION AT YOUR POINT OF SALE With the total cost of fraud in the U.S. estimated at $8.6 billion per year, preventing fraud growth has become a priority. In response, all the card processing networks have committed to migrating to EMV chip technology, which means that before long, it’s likely your customers will be presenting a new type of payment card – one with an embedded smart chip. EMVenabled cards (chip cards or smart cards) have an embedded microprocessor chip that stores cardholder data and creates a unique digital signature for each transaction. Bank of Guam will be converting to EMV. To make the transition to EMV as smooth as possible, Bank of Guam offers this simple guide for merchants to prepare for this change. (671) 472-5300 www.bankofguam.com FOR MERCHANTS IMPORTANT THINGS TO KNOW EMV Chip Card technology is the industry standard in the U.S., as it makes the acceptance of card present payments more secure. Launched by EuroPay, MasterCard® and Visa® and adopted by all major credit card brands, chip technology is currently in use or is being implemented in more than 80 countries. FRAUD LIABILITY SHIFT The major credit card brands all set multi-year deadlines in 2011 for credit card processors and the retailers they serve to transition to EMV. As of Oct 2015, merchants are liable for any counterfeit and stolen card fraud that may occur unless their terminals are EMV-compliant. This is commonly referred to as the “fraud liability shift.” *For any questions on the fraud liability shift, please visit the nearest branch to speak to a BOG officer or call Card Services at (671) 472-5187. IMPORTANT Q&A’s Q. How does EMV Impact the merchant? A. In order to process Chip Cards, the merchant’s terminal needs to be EMV-enabled. In the coming months, Bank of Guam will be reaching out to all its merchant customers to schedule the upgrade of their terminals. EMV Q. Will there be a change in the processing of Chip Cards? A. Yes. With Chip Cards, customers and merchants will no longer swipe the card. Instead, the Chip Card must be inserted into the terminal card reader and kept there for the duration of the transaction until prompted to be removed. Because this is a significant change from the current process, Bank of Guam will ensure that merchants and their employees are properly trained on the new procedures. Stands for Europay, MasterCard & Visa Q. If my terminal is chip-enabled, what happens if the Chip Card is removed too soon or if the Chip Card is swiped and not inserted? A. If the Chip Card is removed from the card reader before being prompted by the terminal, the transaction will not be able to complete the authentication process. This will result in the cancellation of the transaction and the non-completion of the sale. If the Chip Card is swiped and not inserted, the terminal will prompt you to insert the card. Q. If the terminal is not chip-enabled, can the merchant accept Chip Cards? DEBIT JUAN CARDHOLDER A. Yes. Because most Chip Cards also have a magnetic strip on the back, they can be used at a terminal that is not yet chip-enabled by swiping the card in the traditional manner. Q. If the terminal is already upgraded and chip-enabled, can the merchant still accept cards that are not chipenabled (i.e. cards with only magnetic strip)? A. Yes. Merchants with terminals that are already chip-enabled can continue to accept non-chip cards or cards with only a magnetic strip. These cards have to be swiped in the traditional manner. Q. Does EMV technology provide the same protection to merchants for card-not-present transactions such as online purchase or Mail order Telephone Orders? A. The enhanced security features of Chip Cards are only applicable with card-present transactions, where a Chip Card is in contact with a chip-enabled terminal. If a card transaction is done online or taken over the phone, the same risks apply as if the card were a magnetic strip card. Merchants who accept card-not-present transactions should follow their established procedures and controls in verifying the transaction. Q: Will the new EMV-compliant terminal be different from what merchants are currently using? Will there be an additional cost? A: No. The EMV-compliant terminals are the same models that merchants are currently using. What will be upgraded is the software. There will be no additional cost for the upgrade. Q: Will travelers with chip-enabled cards visiting the U.S. have issues paying for purchases if the US merchant is not yet EMV-compliant? A: Almost all chip-enabled cards have a magnetic strip, so they can be used in countries that have not yet deployed EMV, such as the US. However, if the issuing bank disables the magnetic strip feature on their cardholders’ Chip Card, that card will not be read in a non-EMV terminal. Q: What is the difference between contact and contactless Chip Cards? A: Contact EMV cards refer to cards with microprocessor chips that need to be in contact with an EMV-enabled ATM or terminal reader throughout the transaction in order for the chip to be read. Depending on the issuing bank, some Chip Cards also have a “contactless” functionality where the chip can be read by simply tapping a contactless-enabled terminal, typically for small purchases and at stores with quick checkout counters.
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