EMV One Year Later: Good News and Bad

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Payments EMV

EMV_BlogPost_2x_r1.pngFirst, the good news for e-commerce merchants: card-not-present (CNP) channels in the US continue to outpace total retail sales, according to the Dept. of Commerce. CNP transactions increased nearly 11% last month, compared to 2015, with sales totaling nearly $47 billion. June and July saw increases of 14% each compared to last year. In addition, as a result of EMV, card networks are reporting that counterfeit fraud has declined by more than 50% compared to a year ago. One top retailer even reported a decline of 90% in their counterfeit fraud just 30 days after implementing the EMV technology.

Now, the bad news: as predicted, the EMV liability shift which occurred a year ago has resulted in a surge in CNP fraud, with fraudulent transactions increasing 137% from Q2 2015 to Q2 2016. Fraudsters were clearly informed of the impacts of the EMV shift on their activities and responded accordingly. This, even though many point-of-sale retailers have not yet installed EMV-compliant terminals (estimates vary from 44-70% compliance). According to a survey by The Strawhecker Group, only 29% of US retailers can currently accept EMV cards due to delays in certifying the new terminals.

Chargebacks as well have seen an uptick, with 60 percent of survey respondents admitting to an increase in chargebacks because of their lack of EMV compliance.

So, what should you do if you’re a CNP merchant? Make sure you have an effective, efficient automated fraud solution in place that will alert you to suspicious transactions and allow you to act on them, relieving you of the burden of having to hire staff and commit other resources to conducting manual reviews of questionable purchases. With a good fraud solution—such as offered by Recurly and integrated with our subscription management solution—you’ll be able to accept more orders with confidence, knowing that you have a tool in place that is monitoring your transactions and denying the ones likely to be fraudulent.

Fraudsters may be wily but they don’t have to win. You can fight back, accept more orders with confidence, and keep the profits that are coming to you.

To learn more about how Recurly can help your fight fraud, talk to a Recurly expert at (844) 732-8759 or sign up for a demo below.

 

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