What Is a Liability Shift?
A liability shift happens when responsibility for fraudulent charges moves from one party to another — usually from the card issuer to the merchant, or vice versa — depending on which security standards were followed during the transaction.
Put simply:
If your business doesn’t use the latest fraud-prevention tools, you might end up paying for fraud that wasn’t your fault.
Liability shift exists to encourage businesses to adopt secure technology, like EMV chip terminals and 3D Secure for e-commerce. It’s a global standard that protects both sides — but only when used correctly.
How Liability Shift Works in Practice
1. In-Person Payments (EMV Chip & Contactless)
Before chip technology, card fraud was rampant. Magnetic-stripe cards were easy to clone, and liability almost always fell on the bank. But with EMV chip cards, the rules changed.
If a customer uses a chip card or digital wallet, but your terminal only accepts magstripe swipes, the merchant is now liable — not the bank.
Example:
A customer walks into a boutique in Doha and pays with a Visa chip card. The store’s old terminal can only swipe cards. Later, the card turns out to be cloned. Because the merchant didn’t support EMV, they bear the financial loss — not the bank.
Takeaway:
Upgrade to EMV-enabled terminals (like those offered by Dibsy’s POS solutions) to ensure transactions are authenticated securely. EMV uses dynamic data that can’t be duplicated, making it nearly impossible for fraudsters to clone a card.
2. Online Payments (3D Secure 2.0)
For e-commerce, 3D Secure (3DS) is the global benchmark for authenticating online payments. It’s used by Visa (Visa Secure), Mastercard (Identity Check), and American Express (SafeKey).
Here’s how liability works:
- If a merchant does not use 3D Secure, and fraud occurs, the merchant is responsible for the chargeback.
- If 3D Secure is enabled, and the bank authenticates the customer, the liability shifts to the issuer — protecting the business.
Example:
An online electronics store in Qatar enables 3D Secure through Dibsy’s payment gateway. A fraudster tries to use a stolen card, but 3DS prompts biometric authentication. The transaction fails — saving the merchant from loss.
Takeaway:
Always enable 3D Secure 2.0 for your online store. It adds frictionless, customer-friendly verification — through OTP, Face ID, or fingerprint — while ensuring that liability shifts away from your business.
3. Digital Wallets & Tokenized Payments
Digital wallets like Apple Pay and Google Pay have redefined secure payments. They use tokenization — replacing sensitive card details with encrypted tokens — and require biometric authentication.
That means even if the data is intercepted, it’s useless to fraudsters.
From a liability standpoint, this is great news for merchants:
- Authentication happens on the customer’s device.
- Tokens replace real card data.
- Liability generally shifts away from the merchant.
Takeaway:
Encourage customers to use Apple Pay or Google Pay during checkout. Not only does it reduce fraud exposure, but it also improves conversion — especially for mobile shoppers. Learn more from Dibsy’s Apple Pay guide.
4. Mail Order / Telephone Order (MOTO) Payments
MOTO transactions — when card details are given over the phone or email — are inherently risky. There’s no customer authentication, which means the merchant bears full liability for fraud.
Best Practice:
If your business relies on MOTO payments (for example, hospitality or travel), limit them where possible, or introduce internal verification steps like confirmation emails and ID checks.
Why Liability Shift Matters for Businesses in Qatar
The impact of liability shift goes beyond just who pays for fraud. It influences compliance, trust, and growth.
1. Financial Protection
Chargebacks and fraud losses can add up quickly. EMV and 3D Secure ensure those costs are minimized or transferred to the issuer.
2. Regulatory Compliance
The Qatar Central Bank (QCB) mandates that all PSPs and merchants adhere to global card network standards. Using EMV and 3DS not only protects your business but keeps you aligned with QCB’s payment security requirements.
3. Customer Trust
Customers are becoming more aware of payment security. When they see that your checkout supports secure authentication and digital wallets, it increases confidence — and conversion.
4. Operational Efficiency
Handling fraud disputes wastes time and resources. Liability shift reduces those headaches, allowing your team to focus on growth rather than chargebacks.
Best Practices to Minimize Fraud & Benefit from Liability Shift
1. Upgrade to EMV-Enabled and Contactless Terminals
Ensure all in-store devices are EMV- and NFC-ready. Legacy magnetic readers are easy targets for skimming fraud.
2. Always Enable 3D Secure 2.0
This is non-negotiable for e-commerce. It helps you comply with QCB’s security standards and significantly lowers chargeback risk.
3. Promote Digital Wallets
Apple Pay and Google Pay are becoming default choices for Qatar consumers. They reduce fraud exposure and improve checkout speed.
4. Educate Your Team
Train your cashiers and support staff to spot suspicious behavior, verify identities, and understand how authentication works.
5. Monitor Fraud & Decline Trends
Keep an eye on your payment analytics. Sudden spikes in declines or chargebacks may signal a larger issue.
6. Partner With a Trusted PSP
Work with a payment provider like Dibsy that continuously optimizes transaction routing, authentication, and fraud screening — ensuring you always benefit from the latest security standards.
Qatar Central Bank Compliance & Security Alignment
The Qatar Central Bank’s Payment Systems Department enforces stringent standards for PSPs and merchants handling card data. Liability shift complements this regulatory vision by ensuring every participant in the payment ecosystem is accountable.
Key QCB expectations:
- Adoption of EMV chip technology across POS terminals.
- Implementation of 3D Secure 2.0 for all e-commerce transactions.
- Support for digital wallets (Apple Pay and Google Pay).
- Compliance with PCI DSS Level 1 certification for cardholder data security.
Dibsy meets and exceeds these requirements, offering merchants a secure and compliant environment to accept payments online, in-store, or through mobile devices.
Real-World Example
Let’s look at two businesses in Qatar:
Case 1 – In-Store Fraud
A fashion retailer in West Bay still uses an old magstripe POS. A fraudster uses a cloned card to buy QAR 3,000 worth of goods. Because the terminal isn’t EMV-compliant, the merchant — not the bank — covers the loss.
Case 2 – Online Fraud Prevention
An online electronics store integrates Dibsy’s payment gateway with 3D Secure 2.0. A fraud attempt is made using a stolen card, but the issuing bank authenticates the transaction via OTP. When the cardholder disputes, liability shifts to the bank. The merchant avoids the loss.
Result:
The first merchant loses money and reputation; the second gains trust and operational efficiency.
How Dibsy Helps Businesses Reduce Fraud Risk
At Dibsy, we believe payment security shouldn’t be complex. Our platform is designed for Qatar’s merchants — from startups to enterprises — offering modern tools that make fraud prevention effortless.
1. Secure Payment Gateway
Our online payment gateway supports 3D Secure 2.0, enabling frictionless authentication that keeps your transactions safe and compliant.
2. EMV & Contactless Terminals
We provide SoftPOS solutions that align with QCB and card-network standards, minimizing in-person fraud.
3. Digital Wallet Integrations
Enable Apple Pay & Google Pay in just a few clicks. All tokenized, all compliant, all secure.
4. Real-Time Fraud Monitoring
Our AI-powered monitoring tools flag suspicious activity instantly, giving you full visibility across every payment channel.
5. Seamless Onboarding & Local Support
With Dibsy, integration is fast, and support is local — because security should never come with frustration.
Conclusion: Future-Proof Your Business Against Fraud
Liability shift isn’t just a compliance checkbox — it’s a competitive advantage. It protects your bottom line, builds trust, and positions your business as a secure, forward-thinking brand in Qatar’s rapidly digitizing market.
By embracing EMV, 3D Secure, and digital wallets, you ensure that when fraud happens, it doesn’t happen on your dime.
At Dibsy, we’re building the payment infrastructure Qatar businesses can rely on — where every transaction is secure, seamless, and compliant.
Ready to reduce your fraud risk? Talk to Dibsy today →
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