The perception has been that merchants are not that concerned with fraud and security. Latest research however shows this not to be true and merchants today are very concerned;  in fact one research paper goes as far as to say they are more concerned than the banks are. This may well have to do with a change in the liability which has shifted to the merchant from the issuing bank. Also, in terms of the European PSD 2 requirements, merchants will be held liable for non-compliance.

Will merchants be tempted to move away from card payments if this security and fraud threat becomes too onerous.? Is it the job of the merchant to “police” fraudulent card transactions?  One could well ask what happens if the merchant accepts fraudulent/counterfeit notes.  They carry the risk if, when attempting to deposit this cash, the bank picks up the fact that they are fraudulent banknotes. In the same way, liability shifts to the merchant if they do not comply with the regulation.

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