Credit Card Machines the More Dominant Method of Payment?

Cash transactions between consumers and merchants have seen a great decline in the previous decade. It is being said that the phrase “Cash is King” is no longer perceived as the truth, and that plastic money is now showing more dominance. Is this good?

It is good if you learn to accept it and adapt according to it otherwise, it can get the better of you. The increased demand for credit card machines or card readers as a method of payment is causing stress among small and medium-sized businessmen. They are finding themselves at a risk of either losing customers or having to pay up a percentage of their earnings as bank transaction fees.

Credit Card Machines the More Dominant Method of Payment

It is advised that small and medium-sized businessmen start initiating the proper implementation of EMV card readers and credit card machines. While it is true the transaction charge imposed by conventional banks seemed to be a bit much and was the main reason merchants were discouraged from using card readers.

But all of that is in the past now, SumUp which is Europe’s No.1 fastest growing card company has branched its way into the markets of the United States. The company has the ability to provide small and medium-sized businesses with card reader technology, they even impose a minimized transaction fee (as low as 2.65% per transaction). You can hook yourself up with a card reader; feel free to check out their website https://sumup.com/

SumUp has attained massive success in Europe and South America, they have had a splendid record in Brazil. The company wishes to manifest the vision of becoming the world’s first and biggest globally card brand. They provide new EMV based card readers and even a way to accept card payment for all those businessmen who are always on the go.

It is totally up to small and medium-sized businessmen as to what type of credit card machine they decide to use. But they should be fully aware of the types of card readers available in the market, below we have mentioned the type of card readers in brief.

The Three Type of Card Readers available in the market:

EMV Card Reader: This credit card machine is based on chip technology; the card which is used on this card reader has an encrypted chip attached to it. The chip contains all the essential details that will help initiate the transaction, and deduct the amount to be paid from the consumer’s bank account. EMV stands for “Europay Mastercard Visa”, it is gaining popularity in the market.

emv chip

Due to the advanced chip technology, EMV cards can be used on nearly all modern terminals. This payment method is secure and is not susceptible to fraud in a card-present situation.

Swipe Card Reader: This is the most basic card reader technology available in the market. This card reader requires the user to swipe their card along the slot present on the machine. The card should have a metallic strip which once swiped will help initiate the transaction and transfer money to the merchant.

swipe card reader

Swipe card readers are oddly out of fashion and will soon be phased out, due to security concerns. A fraudster can easily replicate this mode of payment which will cause inconvenience to either the merchant or the customer.

NFC Card Reader: NFC stands for “Near Field Communication”, in this type of card reader all those cards which have been equipped with NFC technology, smartphones or other smart devices that use RFID are eligible for making transactions. This type of payment is known as “contact-less” payment.

Near Field Communication nfc

The user might not even have to touch the reader, the card reader will read the credit card and the chip which is equipped along with the card. For a transaction of low amount, the card user can simply ‘Tap’ on the modern terminal and the payment will be made in an instant.

It should be noted that fraud is possible in any case, but are minimized in the case an EMV card reader or NFC card reader is used. The chance of fraud occurring in a situation where the card is not physically present is a bit common. Cases such as, online payments or providing details of your card on the phone are easy targets for fraudsters.

Now that we are talking about fraud and counterfeit payments, you should be fully aware of the “Liability Shift“, which determines who is guilty. What is the liability shift you ask?

The Liability Shift was introduced on October 1, 2015. This reform was made to protect visa chip cards or people who had implemented chip technology. It states that “In the case of an in-store fraudulent payment, the party which has not invested in chip technology will be held responsible for the fraud.

Let us explain this reform with the help of an example:

1st Scenario: The customer made a payment with a magnetic strip card on a swiping machine, this payment turned out to be a counterfeit payment. In such cases, the customer is held liable for fraud due to conventional rules.

2nd Scenario:  A customer makes a forged payment is made using a chip-equipped card on a traditional magnetic stripe only terminal. In such a case the liability will shift to the merchant as the cardholder had spent on chip technology for a safer transaction while the merchant did not.

3rd Scenario: A customer found to have made a fraudulent payment using their chip encrypted card on a chip-based card reader. In such a case the merchant is off the hook, while the liability will shift to the customer.

It should be noted that the “EMV Liability Shift” is not enforced in cases of card-not-present scenarios. The benefit of this liability shift is that it encourages both consumers and merchants to adopt chip technology. As in cases both of them have invested in chip technology the overall risk of being duped is eliminated.

So what are you waiting for? Go and get your hands on those smart card readers, for small and medium-sized business owners it is recommended you try out the EMV card readers provided by SumUp, you can check out their website https://sumup.com/