American Express has launched its Small Merchant EMV Assistance Program, following President Obama's announcement last October.
The nationwide campaign will help U.S. small merchants fight fraud through a $10 million-reimbursement program designed to accelerate adoption of EMV payment terminals. It will also arm small merchants with knowledge about EMV’s security benefits.
As part of American Express’ program, eligible merchants that have upgraded to an EMV terminal can request a one-time $100 reimbursement from American Express by visiting americanexpress.com/fightfraud.
The company will deliver educational resources about EMV to small merchants across the United States through email, a telephone hotline and a website. A team of ambassadors—the American Express Fraud Squad—will also visit New York City, Atlanta, Miami and Houston, meeting face-to-face with small merchants to spread the word about EMV and its benefits.
To qualify for a reimbursement, provided in the form of a $100 American Express Gift Card, a U.S. small merchant must have less than $3 million in annual American Express charge volume and submit a request for a reimbursement between Feb. 1, 2015, and April 30, 2015. Other terms and conditions apply.
“Fraud is a growing problem and the move to EMV is an important step towards stemming payment-card fraud in the United States,” said Anré Williams, president of Global Merchant Services at American Express. “Unfortunately, many small merchants do not know about EMV or what they need to do to take advantage of it. We created the Small Merchant EMV Assistance Program to help them. By providing financial and educational assistance, we hope small merchants more quickly adopt EMV so they can ensure their customers feel safe when shopping at their stores.”
Payment-card fraud is a top concern among small merchants. According to the American Express EMV Preparedness Survey, conducted in October 2014, 67% of small merchants surveyed indicated that protection against and prevention of payment-card fraud was very important to running their businesses. Furthermore, 52% reported that they feel they are at higher risk for payment-card fraud than larger businesses—with nearly half of those small merchants citing a lack of money to invest in fraud prevention or a lack of access to experts who can assist them as the biggest reasons why.
In addition, more than a third of the surveyed small merchants said they either have not decided whether they will upgrade their payment terminals, or they do not plan to upgrade their payment terminals. Of those small merchants, 57% cited the cost of terminals as the main reason.
“The Achilles' heel for EMV merchant adoption will be small and micro merchants that are not only unprepared for EMV, but even unaware of the fraud-liability shift in the United States this year,” stated Nick Holland, Head of Payments for Javelin Strategy & Research. “The majority of small merchants lack the financial resources and expertise to make the transition to EMV.”
EMV technology helps reduce the risk of fraud stemming from counterfeit and stolen payment cards by storing information on a chip embedded in the cards. Payment terminals must be equipped with the necessary technology to be able to read the chips in order for the technology to work. Beginning this October, U.S. merchants that do not have EMV-enabled payment terminals and experience certain point-of-sale fraud may be held liable for the costs stemming from such incidents.
[Image courtesy of American Express]