What the End of Swipe and Sign Cards Means for the Restaurant Industry

Restaurant Insurance in Texas

In most of the world signing for credit card purchases is a foreign concept. Employees at the grocery store or mall tend to get confused if told that a card needs to be swiped instead of inserted into the slot designed to read a chip in the card. Slow to make the change, the U.S. will officially be making the switch by October 2015, which signals the end of an era and a set of changes that the restaurant industry needs to be aware of.


Recent large-scale credit card fraud from companies such as Target should cause restaurants to take a closer look at their restaurant insurance in Texas and to ensure that they are covered in the event of an unfortunate occurrence such as the incident at Target.


However, the new pin-and-chip system may actually make this data more secure at retailers and restaurants alike due to the fact that credit cards will be each embedded with a microchip with security data, allowing restaurant owners with restaurant insurance in Texas to feel more at ease when running their businesses.


While converting over to a new payment system might seem like an unnecessary hassle and cost for restaurant owners since pin and chip cards can still be swiped like traditional cards, there is one major factor that might persuade them to make the switch.


As of October 2015, when the major American credit card companies make the switch to pin-and-chip cards, there will be what is called a liability shift. A credit card company always looks into card fraud to determine who is at fault. In October 2015, the companies will consider the party with the most out-of-date technology at fault for credit card fraud.


What this means is that if any restaurant, regardless of their Texas restaurant insurance coverage, does not have a pin-and-chip payment system, but a customer has been issued a pin-and-chip card by their bank, the restaurant would be held liable for that fraud.


While there is always a chance that an establishment will avoid cases of credit card fraud, it is always better to be safe than sorry. Hopefully, all restaurants will make the transition to this new, more secure system and help provide peace of mind for everyone involved.


photo credit: Consumerist Dot Com cc