EMV Implementation Deadline is Fast Approaching


EMV is set to hit America with a deadline of 2015. EMV, which stands for Europay, MasterCard® and Visa®, is designed to reduce the opportunities for card payment fraud. According to PNC Merchant Services Company, It is “Chip-embedded payment cards are nearly impossible to duplicate, and when combined with additional layers of security–such as encryption, tokenization and other strong authentication techniques–EMV significantly reduces opportunities for card payment fraud.”

The United States is the last major world economy to turn to EMV. The United Kingdom, on the other hand, was one of the first. They experienced growth in total card purchase but saw a significant reduction in total card fraud – 17 percent.  According to an article by PNC Merchant Services Company, the United Kingdom is experiencing the lowest levels in lost, stolen, and counterfeit card frauds since the 1990s.

With the deadlines fast approaching, companies are beginning to educate themselves on the implementation of the EMV structure. Major card networks and industry groups are providing merchants with guidelines and information.  Major card associations have also announced that merchants will be responsible for fraud liability if they fail to implement the EMV structure. The deadlines of 2015 will pass the liability from the bank to the merchant if they have not installed an EMV – capable terminal.

According to eMerchantBroker.com, “Card companies are making incentives available to its merchants that begin to transition to the new EMV technology. They are waiving fees to those that are using the dual contactless machines. Making it possible for the merchant to process both types of cards until the whole system across the nation has transitioned over.”

EMV definitely has its perks. First, it provides much stronger fraud protection. The combination of the PIN card authentication and card validation chip features (or “PIN” and “Chip) means the protection against consumer-level attacks is much stronger. In addition, there are benefits to the United States delaying their migration to EMV. Because so many other countries have already adopted this method of chip-based payment cards, the U.S. has examples of how successful it has been.

On the other hand, it is important to note that because the U.S. waited so long to implement the EMV it could put them at risk until the system is fully functioning. As other countries are adopting the Chip and PIN – such as Canada and Mexico – criminals will move to the U.S. to seek their last quick and easy opportunity to conduct their fraudulent activity. PNC Merchant Services Company gives an example, “the Netherlands had low card fraud rates prior to 2006, so they were slow to adopt Chip and PIN like many surrounding nations were doing in the mid-2000s. The unfortunate result was that the fraud rate in the Netherlands soared by more than 300 percent in just four years–from 1.5 percent in 2005 to 5 percent in 2009.4.”

So, as the deadline approaches, merchants need to stay informed about the upcoming changes and plans that are in store; this will ensure the safety of their business and keep them from experiencing negative impacts on their business.