The vast majority of retailers in the US accept credit cards. (Those that don’t seem to either be businesses with virtually no local competition or businesses very tightly focused on their local market. Like the only mechanic that works on foreign cars in a small town, or a neighborhood restaurant.) A big shift is in progress, from magnetic strips to chip-embedded cards and you’re caught in the middle, whether you realize it or not. Just don’t believe everything you read – or your merchant account rep tells you … [level-members]
The big push has been for merchants to all but demand that you upgrade your credit card terminals to those that can read the chip-embedded cards. (These are the cards that you “dip” rather than swipe, and that stay in the machine to be read and verified until the transaction is complete.)
The penalty – and the motivation for you to shell out to make the switch – is the credit card firms pushing fraud responsibility back on retailers who aren’t using the chip cards. Problem is, the chip cards haven’t been the panacea everyone was hoping for.
Part of the problem has been, unsurprisingly, delays in getting the new card readers in place and certified. (Merchants haven’t been shy about pointing out that the certification firms and the banks frequently have close ties. It’s not hard to imagine that there’s little motivation to move ahead faster.)
And of course, not all consumers have the updated cards.
How big a problem this is for you depends on the size and nature of your business. If you’re a local shop with local customers, your risks are probably quite a bit lower than if you are a larger business, have multiple locations, or do a reasonable amount of mail-order business. (Though there seems to be some debate on remote transactions where the card is not present.)
You may want to evaluate your risk before taking the plunge, including looking at the number of fraudulent charges you’ve been the victim of over recent years. (And whether they are trending up or down.) Don’t necessarily jump at updating your terminals unless the upgrade isn’t costing you anything out of pocket.
And if you do make the upgrade, do all you can to get a commitment on certification dates before signing any dotted lines. There’s no point in paying for a service upgrade you can’t use. [/level-members]