At Vantage, we routinely field questions about payment processing technology. Clients come to us every day with their queries: sometimes specific ones about their business model while others become more frequently asked. With the growing buzz surrounding EMV chip card rollout, driven in part by a frenzy to sell terminal hardware, here is one of our top EMV FAQs to date:

Question: "My business processes all credit card payments online and never sees a physical credit card because we receive this information over the phone.  Is this EMV-ready terminal something that we will need to acquire?"

Answer: If payments online and over the phone are the only transactions your company manages, then no, you won't need an EMV terminal. EMV is being implemented in an attempt to prevent card skimming and counterfeit mag-stripe card use at companies that handle card-present point-of-sale transactions. If you accept card payments face-to-face in person, you can read more on EMV at www.vantagecard.com/emv. 

However, even if your business doesn't necessitate a new EMV terminal, there are other important considerations for the U.S. roll out of EMV chip cards.  As has been seen when other countries adopt EMV, fraud is expected to rise at easier targets: non-EMV accepting countries, non-EMV accepting merchants and non-EMV markets (card not present, MOTO, ecommerce merchants).

With this in mind, here are a few important considerations and steps you can take to limit your exposure to accepting fraudulent sales.

• Make sure to receive a match on billing address and the three-digit security code during the transaction. Your best practice is to also ship to the billing address provided (assuming it was a match during the transaction). While not all transactions where buyers designate separate billing and shipping addresses are fraud, fraud rates are much higher for these transactions so use your discretion to identify suspicious activity.
• Implement payment policies to watch for unusual orders (large amounts on first time orders and rush overnight shipping requests). Watch for repeat orders in a short period of time. Be suspicious of customers wanting to use numerous cards, especially when the cards all have the same first six digits. This means that all of the cards were issued by the same bank.  And use caution when processing international orders as they have an 8x higher fraud rate.
• Watch free email accounts. Consider using additional email validation services like www.emailage.com.  It is best to no try developing your own in-house home grown fraud systems but to use services that are built for propose. If in tracking your Chargeback Rate, Sales Reject Rate, and Manual Review processes become to labor intensive, see Vantage for complimentary consultation on automated fraud detection technologies you can deploy.

Just because a company doesn't require a new EMV terminal doesn't mean there aren't steps it can take to protect itself and its customers. Contact Vantage today with your questions about payment processing platforms, and to learn more about our services.