Chip and PIN Card Security in Your Shop

Last Updated: August 22, 2009

Card Security – Chip and Pin

If your business accepts card transactions, you need to ensure that the process is secure, and that the risk of fraud is minimised. The biggest part of this process for retailers is implementing the ‘Chip and Pin’ Point of Sale (POS) system for accepting payments.

When making a card transaction, the customer enters their pin code on a small device to authorise their transaction. This replaces the need for a signature and is much more secure; as it is much harder for thieves to find a pin number than copy a signature from the back of the card.

Do I Need to Use Chip and Pin ?

Although you are not legally required to use the system, the advantages of having it, and huge disadvantages of not having it make it essential for all shops accepting card transactions.

“You may be liable for fraudulent transactions after 1^st January 2005 if you do not have a chip and pin system…”

If you do not have the chip and pin system, legislation states that you may be liable for the costs of all fraudulent transactions committed in your shop after 1^st January 2005 with a chip and pin card. (I.e.: Fraud you could have prevented using the chip and pin system)

As almost every new card issued in the UK is a chip and pin card, you are putting yourself at a much higher risk of fraud if you do not use the system. Also, people committing fraudulent transactions will know that you are a much easier target.

Customers are increasingly expecting retailers to have the chip and pin system, and you are likely to lose custom without it; particularly as research shows customers favour the system because of its increased security.