Now that the fraud liability shift has moved to merchants and not on the card issuing banks,customers are seeing an increase in chargebacks in the restaurant industry. There are very specific rules to be followed for processing EMV cards to avoid a chargeback and to whom posses the liability. Many restaurants do not have a method to process these cards which in turn exposes the restaurant and it’s owner’s to the full liability shift.
These new rules, the chargeback notification process and requirements have many confused. Please continue reading and protect yourself from this liability, as the old rules of swipe and signature do not apply to EMV chip cards.
When someone sees a charge from your restaurant or store on their credit card bill, and decides to dispute it by contacting their credit card provider, that’s known as a chargeback claim. When a customer files a chargeback claim, the burden of proof falls to the restaurant or store owner with the new
EMV cards if the transaction was not executed properly forcing you to no longer just produce the actual credit card receipt in question, even if it is signed by the customer! I know It’s crazy! Even when you have cameras too!
We have witnessed Merchants using EMV terminals incorrectly during the payment process cycle and unbeknownst to them they are wide open to be taken advantage of. Chargebacks can be initiated for up to 18 months after a charge was transacted and while a chargeback can sometimes be a legitimate dispute from someone who did in fact patronize your restaurant, they often happen for illegitimate reasons as well.
EMV best practices for restaurants Pay-at-table and tipping options.
If you have a restaurant with table service, EMV could simplify your payment process and change how you manage tips as you see. EMV could save your server time but the “old fashioned way” of running the transaction has just phased out like a VCR!
Before EMV, your server probably made two trips to the table for payment: once to process the card, then back to the table for tip and signature. But with an EMV pay-at-table terminal, your server can process the payment – and the tip – in just one trip to the table. Here’s how it works:
1. An EMV chip card is inserted into the EMV slot of an EMV terminal. It must stay in the slot until the transaction is complete. Make sure to follow the prompts to ensure that the transaction is processed properly.
2. While the card is in the EMV slot, your customer must be present to follow the screen prompts, add a tip, if any, and then authorize the charge with a PIN or signature. The card never needs to leave the customer’s sight which reduces the chance of the card being copied. And the tip amount that the
customer has entered doesn’t need to be manually input later on by your server. Changes in tip processing Many EMV cards require the tip to be entered before the customer authorizes the total amount with a PIN or signature. So it’s important to make sure you understand how tips are processed with EMV chip cards. Here are some recommendations of EMV equipment that may work for restaurants and food service businesses:
- If your customers pay at the table, you may want to choose a wireless handheld EMV terminal like the Harbortouch s90 orHarbortouch Perkwave app that servers can take to the table, so customers can input the tip amount prior to authorization.
- If your customers pay at a register, your EMV upgrade might be as simple as adding an EMV keypad to your system or a small footprint top of the line Harbortouch Echo or Elite POS system.
- If your business is mobile, like catering or a food truck, Delivery, special events, or weddings, a wireless handheld EMV terminal like HarborPay Mobile could be a good solution, so you can accept payments wherever you go.
We’re ready to help To learn more about EMV for restaurants, contact your Harbortouch Financial Merchant Services Representative or call 888-812-6244.