Whilst this subject is not strictly an IT
issue, we feel that it is important that small businesses who accept credit
card payments for goods or services should understand the implications of the
current changes to the responsibilities between card issuers, businesses and
their consumers.
There appears to be some confusion,
particularly with small businesses as to exactly what the changes that have
just come into effect mean to them. There are also a few “grey” areas that
need clarification.
With effect from January 1st
2005, the responsibility for fraudulent use of credit cards falls on the
retailer or organisation accepting the card in payment for services, and NOT
the card issuer.
However, this assumes that the card terminal
has been upgraded to accept the new Chip and Pin credit and debit cards. If
the terminal has not been upgraded by the card issuer or bank, and this is due
to no fault on the part of the terminal renter or business concerned, then
responsibility for any fraudulent use of cards will continue to lay with the
card issuer.
Similarly, if the card provided by the
consumer has not been replaced with a new Chip and Pin card, then
responsibility also still lays with the card issuer.
On the other hand, if the card tendered is a
Chip and Pin card, but the consumer does not have, cannot remember, or insists
on signing the credit card slip, then responsibility for fraudulent use will
lay with the retailer or business concerned and NOT the card issuer.
Further
information on these and related issues concerning the new credit card
technology can be found at:
http://www.chipandpin.co.uk/index.html
In addition, the
Federation for Small Businesses has issued a press release that attempts to
explain some of the issues. You can see it at:
http://www.fsb.org.uk/news.asp?REC=2261
