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How Much Will Chip/PIN Cost To Implement?

In most parts of the world, EMV credit card processing has already become the standard in retail stores and restaurants. These more secure cards come with chip-enabled fraud protection to help keep sensitive financial data from prying eyes. In order to authorize a transaction, chip-enabled cards must be physically present at the point of sale. And instead of simply signing their name, customers must manually enter in a personal identification number (PIN) to complete a purchase.

However, updating legacy credit card readers to accept these newer chip-enabled cards carries certain costs. According to some estimates, U.S. merchants could end up spending $2.6 billion to make their payment processing EMV-ready.

But as an individual merchant, how much will it cost you to implement Chip & PIN within your payment system?

A Breakdown of Chip & PIN Payment Implementation

In order to begin processing Chip & PIN payments, three things must happen:

  • You must purchase an EMV-ready Chip & PIN credit card reader. Prices range from $100 all the way up to $600, depending on the make and model of the terminal. This cost is borne by you, the merchant.
  • Your customers must have EMV-enabled cards. The credit card issuer (and customer) covers this cost. However, your Chip & PIN reader will still be able to process non-EMV credit cards.
  • You must train your employees how to accept Chip & PIN payments (including how to process chargebacks and refunds). This cost can vary, depending on the size of your staff.

When you factor in both the hardware updates and training, implementing Chip & PIN credit card processing might cost you anywhere from $100 to $1,500 (or more).

Is making the transition worth it? After all, older credit card terminals can still read the magnetic stripes that come with Chip & PIN payment technology.

The quick answer is yes. But to understand why, it helps to explore how Chip & PIN credit card processing can help you avoid many costs.

Chip & PIN Implementation and Cost Avoidance

Adopting Chip & PIN credit card processing offers a number of cost reductions — savings that make the transition a worthwhile investment.

Some of these include:

1. Reduced Fraud Exposure

Chip-enabled credit cards offer greater protection against thieves and hackers. This means fewer fraudulent losses. It also means less time (and money) dealing with banks, investigators and card issuers.

In fact, continued reliance on non-Chip & PIN terminals can actually increase the likelihood of credit card information getting hacked. As more merchants switch over to EMV technology, legacy terminals represent low-hanging fruit for thieves and hackers. It’s analogous to being the last one on the block to install a burglar alarm. The chances of your house getting robbed go up.

2. Reduced Liability Exposure

In the U.S., EMV credit card terminals are optional for now. But in 2015, the technology will become mandatory. Merchants who aren't EMV-ready may become 100 percent responsible for any fraudulent activity that takes place.

As an added benefit, annual PCI audits become easier and cheaper once you implement Chip & PIN credit card processing.

There's one other benefit worth mentioning — and it isn't a cost.

Incorporating Chip & PIN processing into your payment system can help boost consumer confidence and sales. In an age of rising credit card fraud, customers increasingly expect merchants to protect their sensitive financial data. Stores that don't implement Chip & PIN technology will end up losing business to stores that do.

To learn more about secure EMV credit card processing at BluePay, contact our payment support team today.

Topics: EMV

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