Chip and PIN, the system aiming to minimise the risk of fraud, has been in the headlines again – but for all the wrong reasons.
Chip and PIN, the system aiming to minimise the risk of fraud, has been in the headlines again – but for all the wrong reasons. According to the Forum of Private Business, small businesses say they need more time to adopt the new technology.
If your business accepts face-to-face credit or debit card transactions, you have just under two months to go before the 1 January 2005 date for implementation. At present, banks pick up the cost for almost all fraudulent transactions taking place, but from January, unless you have implemented chip and PIN, you, as the business owner who accepted a fraudulent card payment, will be liable for picking up the bill.
However, it’s not all that clear cut. According to the Chip and PIN programme, which has been spearheading a campaign to boost awareness and best practice, the rules around when exactly you will have to pay for fraud committed in your outlet are complex.
“But, in general, if fraud is committed with a chip and PIN card and you don’t have chip and PIN-enabled point-of-sale equipment, the bank will not give you the money for any fraudulent transactions. This will be the situation for sales from 1 January 2005,” it says.
Julian David, vice president of IBM SMB UK, believes that businesses need to act now to support the new technology, otherwise it could cost you.
“There is a huge amount of fraud out there – the old method of swipe and sign is not very secure. Not supporting the new technology will result in more expense. Ensure you work with a supplier who understands what your requirements are, which could cover areas such as where counters are in shops and ergonomics,” he comments.
For more information and tips on implementing a chip and PIN system, visit www.chipandpin.co.uk.