Square Rolls Out New Reader for Chip-Based Credit Cards
Square is ready to help out – and cash in on – small businesses preparing for the death of the swipe-and-sign credit card in 2015.
Starting today, you can pre-order the Square Reader for chip cards. The new reader, which will ship in spring 2015, is the first Square device to deal with EMV technology, meaning it has the ability to process payments made with credit cards embedded with computer chips. The $29 reader will accept both magnetic-stripe and chip cards, and can be used with iPhones, iPads and Android devices.
The Chip Card Accessory for Square Stand is also now available for preorder for $39.
"We've been working on our EMV solutions in anticipation of the nationwide switch to new chip-card technology," a Square spokesperson says.
The urgency in the nationwide switch is due to a "liability shift" set for October, 2015. The liability shift moves the responsibility to deal with fraudulent chip cards from banks to businesses without the technology to read chip cards.
"[S]ay, for example, a fraudster buys $30 worth of hot sauce from a restaurant with a counterfeit EMV chip card," Square explained in blog post from July. "If the restaurant doesn’t have a chip card reader to process the transaction, it could be on the hook for the $30."
Banks are pushing for the switch to EMV technology because cards with chips are more difficult to counterfeit than the traditional American credit card with a magnetic stripe. The U.S. is also way behind on the switch to EMV -- most of the world already uses chip cards, a fact that has helped boost credit card fraud in the U.S. Half of all credit card fraud occurs in the U.S., despite how the country only accounts for a quarter of the world's credit card use.
Big businesses such as Home Depot, Jimmy John's, Michaels and Target have made headlines for credit card hacks in the past year. Small businesses are also at risk -- and less likely to have security plans. The nationwide switch to EMV technology can help reduce these risks in the future.