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What Is EMV?

EMV is a fraud-reducing technology that can help protect your business and your customers from nancial loss if a criminal uses a counterfeit, lost or stolen payment card at your point of sale. In other words, the primary purpose of EMV is to make sure the card being used is the original card issued and not a duplicate. Implementing this technology is one of various security measures that merchants can take to help reduce payment fraud.

EMV transactions are made via a plastic card with an embedded microchip. The user’s account information is securely stored on the chip. During an EMV transaction, encryption is used to generate the cryptogram.

If you are considering adding EMV terminals to your POS system, here are three things to keep in mind:

1. EMV is one element of a complete solution to reduce credit card fraud.

EMV does not protect card information during processing in the POS system, nor does EMV protect against transactions made with a stolen card for card not-present payments, such as an online payments, unless it is also an [Chip + PIN] type EMV card. (Note that most implementations of EMV in the U.S. are planned to be [Chip + Signature] implementations.)

2. EMV and end-to-end (E2E) encryption is a better solution.

If your POS does not include E2E encryption, card account information could still be stolen while being processed. In other words, if a card entry device to include both mag stripe readers and EMV devices does not encrypt the card information, or if the card data is not encrypted within the POS software, then a POS system infected with malware can easily read the card data on the POS system. However, the use of an encrypted card read plus E2E software in the POS application helps keeps the card data encrypted in the POS software.

3. EMV does not always protect against stolen cards.

If an EMV payment card is stolen, and the owner has not yet deactivated the account with the issuing bank, the card can be used with a forged signature. EMV cards come in two usage formats: a) Chip + PIN, and b) Chip + Signature. The majority of cards will be Chip + Signature, with some Chip + PIN. This means that the EMV implementation does not protect against the theft of actual credit cards.