As a merchant, when you get new EMV Chipped Credit Cards or Debit Cards, one of your first thoughts is likely ‘what does this mean for recurring billing on cards already issued. Banks and Card Associations talk all about security, safety and encryption – though we all know it’s mostly about shifting responsibility for fraudulent charges on chipless cards to retailers rather than the card issuers. Fortunately, banks are at least doing one important thing right, by reissuing cards with the same account numbers and carrying over rebills from already established transactions.
Digital Apex contacted several banks and providers, who agreed to speak with us on the condition that we not identify them in this article. Each stated with unanimity that the new EMV cards would allow continuity of payment processing. So, unlike the well-publicized hacks of Home Depot, Target and several others, that lead to massive card replacement programs which voided millions if not billions in expected revenue for merchants that were providing recurring service to consumers – these changes will not have a similarly negative impact.
Once a new sale is completed with an EMV Chipped Card, only the token is stored in a store’s database, meaning that customer information is also much safer, which may result in fewer hacks and less cards needing to be reissued in the future. For that reason, while card issuers are celebrating the fact that they have successfully shifted more responsibility for fraudulent charges to retailers, retailers also have some reason to celebrate, as recurring billing becomes a safer and more dependable revenue stream… until or unless card associations regulate it out of existence entirely.
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