In this day and age, consumers expect that cashless payment options will be available to them at any restaurant they visit. That means that if you’re a restaurant owner, you probably already know how important it is to protect your EMV payment system from threats like fraud and theft. However, as automation changes the way restaurants think about customer interactions with ordering systems, it may also be time for them to rethink their approach to financial security. That’s why it’s important to ensure that your payment processing system is equipped with the most advanced EMV chargeback liability protection available.

The most comprehensive approach to chargeback liability protection will center on two factors that may be difficult to reconcile with one another. On the one hand, every restaurant needs to think about its bottom line. Because disputed transaction costs are borne by the merchant, chargebacks can represent a very real cost to your business. In fact, as recently as 2018, Javelin Strategy & Research found that approximately 45% of all consumers would initiate a chargeback dispute in any given year. Furthermore, according to Chargeback Gurus, there has been a 179% increase in chargebacks in the past two years alone.

In many cases, chargebacks are initiated for legitimate reasons. Even the best businesses aren’t perfect and can make errors in fulfilling orders that require a chargeback. However, a concerning trend that is on the rise and likely contributing to increased chargebacks in recent years is friendly fraud. This occurs when customers dispute a transaction on the grounds that they are somehow dissatisfied with the good or service that they received. Chargebacks911 reports that as many as 86% of all chargeback disputes are cases of friendly fraud, and that the rate of friendly fraud doubles by roughly 40% every two years. The need to respond to friendly fraud is clearly urgent and cannot be approached in the same way as cases of predatory fraud.

The second factor that businesses need to confront, in addition to their bottom line, is their relationship with dissatisfied customers. Parsing out which chargeback disputes ought to be challenged forces your business to either incur costs or to potentially sever relationships with existing customers. Customers who commit friendly fraud are already dissatisfied – it’s why they initiated the chargeback in the first place! Challenging their dispute will only increase their dissatisfaction.

As with every other issue at the intersection of technology and business, there isn’t a one-size-fits-all solution to EMV chargeback liability protection. However, as technology advances and the degrees of separation between a customer’s experience of ordering a product and physically receiving it increases, so does the potential for more chargeback costs that jeopardize your business’s bottom line and relationships with existing customers. A business in 2020 needs to have an integrated ordering system equipped with a state of the art Point of Sale system that ensures not only secure payments to protect you from predatory fraud, but also liability protection for you, the merchant, so that you can withstand the increasing threat of friendly fraud from existing customers. It’s a sure way to avoid costs and adapt to the ever-changing EMV payment system landscape.