Why Square Sellers Can Rest Easy About the Liability Shift

The liability shift — part of a nationwide effort to cut down on fraud — is fast-approaching. Here’s what’s happening: banks are now issuing new, more secure chip cards (aka EMV cards) to customers. And sellers are being asked to do their part by upgrading their payments terminals to accept these cards by October 1, 2015.

After that date, your business could be on the hook for certain types of in-person fraudulent transactions if you aren’t set up to accept EMV. Previously, the banks and processing networks ate the cost of some of these fraudulent charges. Now that could fall on you.

What sorts of fraud won’t be covered anymore? The simplest way to think about it is this: the liability is shifting to the party with the less secure technology. A scenario: a fraudster pays with a counterfeit EMV card at a business that doesn’t have an EMV reader. The business processes the transaction as a magstripe transaction (EMV cards also have magstripes). In this case, the bank that issued the card made the investment to upgrade to chip technology, which would have stopped the fraud if the business had had an EMV reader. So the liability here shifts to the business.

It’s all a bit complicated — and scary-sounding. But there’s no cause for alarm. If you reserve your Square contactless and chip reader, you don’t have to worry about the liability shift. We’ll take care of fraudulent charges that would have been passed on to you due to the liability shift until you receive your new reader this fall.

If you haven’t ordered the new reader, you can reserve yours right now. And because we want to make the shift to EMV as affordable as possible for small businesses, the Square contactless and chip reader is now free (for a limited time for qualified sellers). Those who don’t qualify for a free reader can still order one for $49 — and then get $49 in free processing (so it essentially pays for itself).

The Square contactless and chip reader will secure your business — and give you the latest and greatest payments processing technology. It not only accepts EMV but also NFC, so you can securely process contactless payments like Apple Pay (which is where everything is headed).

We’re committed to removing any barriers that stand in the way of running your business. That’s why we’re taking away the stress of the liability shift — and offering a secure product that’s a delightful experience for both you and your customers.

So, rest easy. And happy selling.

About Square, Inc.
Square creates technology that helps sellers of all sizes unlock the value of every sale. Square's register service is a full point-of-sale with tools for every part of running a business, from accepting credit cards and tracking inventory, to real-time analytics and invoicing. Square also offers sellers financial and marketing services, including small business financing and powerful customer engagement tools. Businesses and individuals use Square Cash, the easiest way to send and receive money, as well as Caviar, a food delivery service for high-quality restaurants. Founded in 2009 and headquartered in San Francisco, Square is available globally with offices in the United States, Canada, Japan, and Australia.