A lot of people are asking what EMV is? Is this a new law, a new set of rules? Do I have to accept EMV, and if so, what does that mean for my FOCUS system?
This FAQ should provide you with some clarification information about EMV and what it means to start accepting chip-enabled cards in your restaurant.
Q: What is EMV?
A: EMV is the term for the new worldwide way of transacting, processing, securing & handling credit card data. As of October 2015, merchants (including restaurants) are encouraged to move to accepting credit cards using EMV.
Q: Do I have to accept credit cards using EMV?
A: Technically, no. However, you may receive chargebacks from customers and their banks if you are not accepting their credit card via EMV methods.
Q: Wait, whats this about chargebacks?
A: Yep, so here's how it works. As of October 2015, your Merchant Agreement changed. You may be liable for any fraudulent transactions ran at your restaurant if that transaction is not processed using EMV. So here's an example: let's say that a guy comes into your restaurant and orders a meal. His check is $40 with tip. Now let's say that this guy was using a stolen credit card that had a chip in it, but you didn't run his credit card using a chip reader (EMV). The true owner of that credit card is going to see that charge on their bank statement and they're going to call their bank to dispute the charge. In the past, the bank would eat that charge and the bank would be out the money. As of October 2015, the merchant (the restaurant) is responsible for that $40 and that $40 chargeback will be taken out of the restaurant's bank account.
Q: But wait, I had a signed receipt from the guy who had the $40 meal, doesn't that count for anything?
A: The short answer is, no. Even if the "customer" signed the credit card receipt, since the transaction was not EMV-Compliant the transaction is invalid and the chargeback will stick.
Q: Alright, so am I legally required to process using EMV?
A: No. As of today there is no law stating that you must process via EMV. It's up to each individual restaurant owner & merchant account holder to decide if they should upgrade to EMV or not. Even though EMV is not officially law, you could face pretty severe chargebacks if you're not processing via EMV.
Q: How long does an EMV transaction take?
A: If you've tried a chip-enabled transaction lately, you know that they take a while to process. On average the transaction time is about seven to ten seconds longer than a regular swipe transaction. But they can take slightly longer depending on various circumstances.
Q: Why do EMV transactions take longer than swipe? Isn't the technology newer?
A: Well the technology isn't actually newer. Actually the technology has been around since 1994. This technology has been in use in the European, Asian & South American markets for decades. It's only recent that the U.S. market has adopted EMV as the de facto credit card processing method.
The reason it's slower than a swipe transaction lies in how the actual flow of data works. Without boring you with details, we'll make it really simple.
With a swipe transaction, FOCUS get's the info off the magnetic strip on the card and sends that info to the bank. The bank checks to see if the cardholder is good for the transaction and sends bank an approval. Pretty simple exchange of data, and takes less than three seconds in most cases.
With a chip transaction, there is a lot more going on. The chip reader reads the info off the microchip on the card, this information is then sent to the card network backing the card (Visa, M/C, Amex, Discover etc.), that network then checks with the bank who has issued the card for more info and send a request for more info back to the chip reader at your restaurant. The chip reader presents the request to the card, and the card replies with it's response. Now that data is sent back to the card network, gets forwarded to the card issuing bank where the card is now considered "valid". Now that the bank knows the transaction is "authentic", it can provide an approval based on the amount of the transaction. The bank replies with approval or decline and that data get's sent back through the card network, over to the chip reader and ultimately into FOCUS. Whew that was a lot of back-and-fourth... now you can see why it takes so long.
Q: Are there any functions or features that I lose in FOCUS by upgrading to EMV?
A: Due to the technology inherent to EMV, there are some functions that you may miss by upgrading to EMV. Any functions that require that you "hold on" to the credit card data are lost by upgrading to EMV. These include Payment Reapply, Payment Adjust, Offline Card Acceptance, Capture and in some cases Pre-Auth.
As more restaurants & merchants begin accepting EMV, the card networks and banks are working to ease the adoption of EMV, so some of these "downsides" may go away.
Q: Since EMV is so slow, what are some alternatives?
A: It's pretty safe to say that EMV is here to stay, but there are alternatives. You've probably heard the term "NFC Payments". This relatively new payment technology represents the future of guest-enabled payments and is a good alternative for some restaurants to EMV. Read more about NFC payments here: NFC Payments
Q: What is the cost to implement EMV in my restaurant?
A: There are two component to EMV that you should be aware of, the payment software and the payment terminal.
1) Processing EMV payments requires that your FOCUS system be configured, licensed and ready for EMV processing. To accomplish this, we have constructed FocusPayments. FocusPayment is our signature Gateway & Acquiring Service. This combination of service & software takes the guess-work out of accepting EMV payments in your restaurant and helps control your costs.
Read more about FocusPayments here: FocusPayments FAQ
2) Accepting EMV requires a FOCUS compatible EMV Payment Terminal. These Payment Terminals connect directly to your FOCUS system and allow the chip card to be read by FOCUS. These Payment Terminals also allow you to swipe cards if the card does not have a chip, and most allow you to accept NFC Payments such as ApplePay, Google Pay, Samsung Pay and NFC enabled cards. We have a few different EMV Terminals available to suit your needs.
Here is a list of FOCUS compatible EMV Payment Terminals:
Q: Do I need to order my FOCUS compatible EMV Payment Terminal from FOCUS?
A: Yes. Since the FOCUS system relies on FocusPayments and our software suite, the FOCUS compatible EMV Payment Terminals need to come from FOCUS as they're preloaded with the correct configuration packages to work seamlessly with your FOCUS system.
Here is a list of FOCUS compatible EMV Payment Terminals: FOCUS Compatible EMV Payment Terminals
To help you understand EMV and all the new credit card nonsense, we've compiled some helpful links from our friends at Discover
- Discover: What are EMV Chip Cards?
- American Express: EMV Chip Card Payments & American Express
- VISA: What's an EMV Chip Card?Visa: What's an EMV Chip Card?
- Mastercard: Transforming Payments with EMV Chip Technology.
- Visa: EMV LIABILITY SHIFT Why it pays to adopt new technology
- Creditcards.com: 7 merchant tips to understanding EMV fraud liability shift