Are gift cards a hole in EMV conversion?

Even though many businesses have yet to implement EMV card readers, awareness over this form of payment has grown in the United States since last year. However, adopting this technology more fully seems like it will prove complicated, since merchants have to prepare not just for credit and debit cards but gift cards as well. Unlike regular payment cards, gift cards aren't required to have chips in them, leaving users reliant on the swipe method.

While terminals that accept both stripe and chip-based cards could help merchants process both, that still could leave them and their customers open to the sort of fraud that EMV is supposed to prevent against.

Because they represent a billion dollar industry, gift cards are a possible problem for businesses to consider. Last year, Bob Sullivan at quoted multiple experts who asserted that gift cards are likely to rely on stripe-based payments for the future.

In a piece for Computer World, Evan Schuman wrote about the way retailers have responded to this issue by instituting tighter checks on those who purchase gift cards, which he believes isn't the answer.

"The proper fix for this problem is to close the loop. Make sure that every purchase of a gift card includes the serial number of that card, so that a canceled payment card can almost instantly cancel all recently purchased gift cards," he said. Instead he stated that more gift card security measures would "make it harder for legitimate shoppers to purchase gift cards."

Purchase credit processing software that will give you low rates and a qualified customer support portal for payment issues. Staying up to date with the latest software will help you mitigate problems and avoid potential security gaps.

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