June 28, 2016
Late last week, American Express joined Visa when it introduced policies that should limit fraud costs for merchants facing sharply increased chargebacks since the October 2015 liability shift. As Visa did several weeks ago, American Express announced it would eliminate liability for in-store fraud on counterfeit transactions under $25. Reasons for the explosion of chargebacks on card-present transactions since the beginning of 2016 are unclear, but, according to American Express research, 40 percent of them are for transactions under $25, a rarity before the liability shift.
It has been a busy summer for the major card brands, which are trying to alleviate hurdles that have held merchant and consumer adoption of EMV back and have increased tensions to the point where retailers have taken legal action against the brands and issuers. In addition to recent efforts to curtail the mysterious increase in chargebacks, each of the brands has introduced products or policies designed to either speed consumers through lines or streamline the certification process .
“Combating fraud is an ongoing priority for American Express,” said Mike Matan, vice president of Global Network Business for American Express. “We recognize the migration to EMV in the U.S. is an effort that will take time, which is why we are making these policy changes in order to provide flexibility to those merchants that may need more time to upgrade their point-of-sale terminals to accept EMV chip cards.”