Why is a customer able to dispute a charge because of an EMV liability shift?

[kyleighbaby]

I just received an email from square about a customer who came into my store, purchased an item for $150.00, swiped his card and signed his name.  He is now disputing this because of something called an emv liability shift. As best I can translate, this means we swiped his chip card so now he is saying it is invalid.  So does he really get to do things that way?  He has his merchandise and signed for his sale. Square says it is taking the money out of my current deposit.

Help!

[Joe · Accepted solution]

Hi @kylieghbaby - thanks for reaching out to us here on the Seller Community. We can provide some context here.

The payment transition from Magstripe cards to Chip-based card transactions is an effort to tamp down on fraudulent transactions. Because of the change in credit card security, banks are phasing out magnetic stripe cards in favor of these more secure, authenticated ways to pay. You can learn more about all of this here.

Since dipped transactions are far more secure, it is easier for a customer to dispute - and win - a transaction that was swiped as opposed to dipped.

It's important to remember here that Square does not have any authority when it comes to deciding a resolution on a dispute. That action is totally and completely up to the customers card issuing bank.

More info on dispute resolution here.