Is Chip technology good for business?
How will Chip technology work?
Will it be faster to verify than traditional cards?
Will POS equipment need upgrading?
What will the cost of the new terminals be?
What will Chip terminals be like?
How is my relationship with my acquirer affected?
Are there any changes to settlement procedures?
How do I get a Chip terminal installed?
What staff training will I need to provide?
What kind of Chip equipment is available?
What do I do if a customer's card becomes locked at the Point of Sale?
How do I know if the Chip transaction has been successful or declined?
What do I do if a customer doesn't use a PIN with their Chip card?
Do I have to check anything else when a card is used and verified with a PIN?
What are the fall-back procedures if the POS terminal fails to read the Chip?
Are there any changes to settlement procedures and/or timescales?
What about mail order, telephone order and internet transactions?
Q: Is Chip technology good for business?
A: Yes, because Chip technology means greater security and more streamlined processing, especially when combined with PIN authentication, which can reduce fraud. Merchants will no longer have to store vouchers for these types of transaction. Chip technology will also bring increased opportunities for self-service POS stations.
Q: How will Chip technology work?
A: The cardholder inserts the Chip card into a card reader and leaves it in the terminal until the transaction is complete. The card reader identifies whether a card is PIN-enabled. If so, the customer will be prompted to enter their PIN rather than sign a receipt. Chip transactions will be similar to magnetic stripe transactions in most other respects.
Q: Will it be faster to verify than traditional cards?
A: Once cardholders and sales staff become accustomed to Chip technology, it is much quicker in most environments.
Q: Will POS equipment need upgrading?
A: If you rent your POS equipment your supplier can make arrangements for an upgrade that will support Chip acceptance. If you own your POS equipment you may have to upgrade hardware as well as software in order to be able to read Chip data and enable cardholders to enter their PIN via a keypad if PIN is used rather than a signature.
Q: What will the cost of the new terminals be?
A: Pricing depends on whether you own or lease your equipment. Consult your acquiring bank.
Q: What will Chip terminals be like?
A: Just like existing Chip and magnetic stripe terminals, new Chip terminals will vary in size and shape. All terminals will need to have a Chip card reader. Some will have a PIN keypad for cardholders to type in their PIN.
Q: How is my relationship with my acquirer affected?
A: Consult your acquiring bank to discuss the impact on your relationship.
Q: Are there any changes to settlement procedures?
A: While Chip technology eliminates the need for paper vouchers and streamlines reconciliation, it normally will not negatively affect back-end processes.
Q: How do I get a Chip terminal installed?
A: If your equipment is owned by a third party you will need to contact your acquiring bank or other providers for further information. If you own your POS equipment, contact hardware and software suppliers to discuss what type of Chip terminal is right for your business.
Q: What staff training will I need to provide?
A: Comprehensive staff training is normally required well in advance of Chip deployment. Each merchant should work with their acquiring bank to decide on their own training needs.
Q: What kind of Chip equipment is available?
A: There are a wide variety of Chip solutions to choose from. Some include a PIN option. The list of choices is constantly growing as suppliers introduce new products. Your first step should be to speak to your existing supplier to discuss the options they can offer you. You can also talk to your acquiring bank to find out which suppliers they regularly work with.
Q: What do I do if a customer's card becomes locked at the Point of Sale?
A: A card becomes temporarily locked when a customer enters the wrong PIN several times (typically more than three) in a row. It may still be possible to accept the card with a signature, and the terminal will indicate whether that can be done in each transaction. If not, your customer will need to provide an alternative means of payment. Advise cardholders whose cards become locked to contact their issuer, or to go to a cash machine where they can use the unlock service. Cards always contain issuer contact information on the reverse.
Q: How do I know if the Chip transaction has been successful or declined?
A: The terminal will give you the same messages that it does now. Authorisation follows a similar process and the card is removed at the end of a transaction.
Q: What do I do if a customer doesn't use a PIN with their Chip card?
A: In some countries Chip transactions are still authenticated by signature. In other countries, where PIN authentication is the norm, there will be instances where cardholders do not have a Chip card. For example, disabled cardholders may have a special arrangement to use signature cards, and some domestic and foreign cardholders don't have Chip cards yet. A customer using a non-Chip card will automatically be prompted by the terminal to give their signature. Carrying out the approved security checks will protect you from any liability for fraud.
Q: Do I have to check anything else when a card is used and verified with a PIN?
A: No, a PIN is all that is needed.
Q: What are the fallback procedures if the POS terminal fails to read the Chip?
A: If the Chip fails, the magnetic stripe and signature can usually be used instead. Or, in Chip and PIN countries, if the cardholder forgets their PIN, they may be allowed to use a signature. However, these options may be discontinued once migration to Chip is sufficiently advanced within a particular country. This is one more reason why it is important to encourage customers to use Chip technology now.
Q: Are there any changes to settlement procedures and/or time scales?
A: While Chip technology eliminates the need for paper vouchers and streamlines reconciliation, it will not negatively affect back-end processes. The purpose of Chip and PIN is to enhance cardholder security at the POS.
Q: What about mail order, telephone order and internet transactions?
A: In most countries these types of transaction are not directly covered by the basic Chip migration program. However, there are several initiatives underway that address security for these types of transaction. They include Address Verification, Security Code checking and, for Internet transactions, MasterCard SecureCode™ and OneSMART® MasterCard Authentication.