Credit cards embedded with Europay, MasterCard, and Visa (EMV) microchip technology will soon become the new standard in the U.S. These cards use personal identification numbers (PINs) and dynamic codes to protect transactions, but the transition to new cards and card-accepting terminals may come with a few hiccups.
“For businesses that distribute credit cards to employees to use for business expenses, it’s important to prepare for snags and to educate employees about how to use the new cards,” says Douglas V. Wyatt, executive vice president and senior commercial banker at Fifth Third Bank.
Smart Business spoke with Wyatt about steps businesses can take to smooth their transition to EMV credit cards.
How can companies help employees transition to the new cards?
The process for using these cards will be different from what employees are accustomed to. For example, in-store checkout may no longer require a card swipe, and employees might be asked to provide a PIN instead of signing. Companies can keep headaches to a minimum by assigning an employee to spearhead communications with card users and card issuers.
The designated team member should be available to provide troubleshooting tips, especially early in the process. Companies can work with their banking partner to educate their designated employees and learn about common issues, how to manage them, and who at the bank can help if a more complicated problem arises.
Prepare all card-using employees for these changes before they start making purchases as mistakes will be common initially. For instance, the process requires users to insert the credit card into a terminal and leave it there during the transaction, so people may forget to reclaim the card afterward.
Banks are helping with this education by providing print materials that explain how the card works, webinars to help cardholders and company administrators learn about chip technology, and help centers to answer individual employee questions.
Companies should consider creating a list of likely problem scenarios with troubleshooting solutions to ensure quick resolution.
How should companies manage their cards’ PIN codes?
Before employees can use their cards, they need to set up a PIN code and activate it by using their cards at a business that processes transactions in real time. The card won’t work properly until this has been done. While many U.S. companies conduct real-time transactions, some overseas merchants process transactions only once per day. Team members who travel internationally may run into issues if they use their new PIN for the first time with such a vendor.
Some employees assume that they can simply update it via their bank’s online management portal, but that’s just the first step. If they then try to use their new PIN at an offline system, it may not work. Employees who don’t know why their card isn’t working may try to use the inactive PIN multiple times and ultimately lock the card so it can’t be used at all.
What other risks must be addressed?
Chip technology is not capable of fighting all transaction fraud. The EMV card improvements do not help protect online purchases and they don’t add extra security for in-store transactions that still use the familiar magnetic stripe.
Employees using the corporate cards should be warned that the chip technology doesn’t make their cards invincible, and that they should still be cautious whenever they use them — in fact, it’s expected that online purchases will be more frequently targeted for fraud after the new in-store standards are in place.
Companies should ask their banks for advice on making online transactions more secure and issue warnings to employees that they need to be vigilant when making online purchases with their corporate cards.
Fraudsters follow the path of least resistance. While chip cards offer added protection, criminals will soon migrate to other tactics.
Fifth Third Bank. Member FDIC.
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