You don't even have to be tuned into the news to have heard about the the increased amount of credit card fraud and theft of customer data from retailers. Chances are, you've received an email from a retailer apologizing for the breach and advising you to change your login data and check your credit card statements. Luckily, the advent of smart-chips in credit cards should increase credit card security - but not necessarily for ecommerce sites.
EMV (named for founders EuroPay International, MasterCard and Visa) smart-chip cards are becoming globally standardized. These credit cards come embedded with a computer chip that is attached to the end-user's personal account information. Because the smart-chips are much harder to clone, they offer more security than the mag-strip technology that has been standard for decades. Many credit card companies have already announced plans to limit or eliminate their liability for merchants that do not have smart-chip compatible point-of-sale devices. This is a major incentive for brick-and-mortar retailers to make the transition and increase their security. But what about ecommerce merchants?
When fraudsters start hitting roadblocks caused by these smart-chips, they are likely to shift their attention elsewhere. The enhanced security of smart-chips doesn't really apply to card-not-present transactions - the primary transaction-type for ecommerce. In light of this, it's likely ecommerce fraud will be on the rise.
With this in mind, it would be wise to evaluate your current fraud prevention tactics. Meet with your fraud prevention team and ask them about their preparation plans as more smart-chip enabled credit cards rollout. You should also stay up-to-date on the latest trends in fraud, as well as fraud-fighting technology. That way, you'll stay one step ahead of fraudsters.