The low cost hardware and huge user bases of mobile credit card processing has made cards more ubiquitous than ever before. But that easy hardware might not be as compatible with a potential future trend: the chip card also called EMV payments. Long the standard method of payment in Europe and other parts of the world, American banks are slowly starting to phase in the more secure, but much more expensive chip card. Something business owners will want to take note of before thinking their mobile payment system is really ready for the future.
Chip Card Readers In Stores
In an effort to curb fraud, liability will soon shift from card issuers to merchants if the merchants have not upgraded payment systems to terminals like those found in Canada and Europe that don’t use the magnetic stripe, but instead require a chip and pin. For a lot of small businesses that have been riding high on the easy fees of mobile payment services like Square, this means the easy and free technology to turn their iPads into credit card machines could get them into huge trouble.
Benefits to Chip and Pin
A lot of Europeans are often shocked of American customs to hand over cards and allow the waiter to process the transaction on their behalf. And the wide introduction of the more secure chip and pin system will mean added security both at the technological level and also in the sense that now customers at stores and restaurants will never lose sight of their cards. Of course, many American businesses have become accustomed to easy services like Paypal or Square, but they are soon going to lose the ease of the magnetic strip.
This upcoming new rule means that a lot of businesses, where customers will expect to use their cards, will need to upgrade their point of sale systems, choosing card readers like portable Verifone systems that will read the European style chip. Previously popular low cost systems will offer updates to their magnetic stripe readers, but these have yet to be proven as reliable and will also add costs to their current free reader model.
In the end the upgrade will end up creating a safer environment for card uses, but businesses need to be prepared for the transition with the right equipment.