EMV May not Reach Ubiquity until 2018

Jun 05, 2014

With EMV already making its way to the U.S., concerns have arisen that no one has made an effort to educate merchants and consumers about the technology involved. As a result, the EMV-chip cards may not become ubiquitous in the United States until 2018. According to an article by David Heun of ISO & Agent, “Teaching consumers will be difficult in the U.S., especially because card issuers are divided on whether to offer chip-and-PIN or chip-and-signature authentication.”

At present, the feeling is that someone really needs to step forward and take the reins in regard to the education side of EMV. According to Heun, the U.K., with an EMV transition deadline of 2005, was more straightforward with the education involved in implementing the new system.

Not only is it a concern that retailers will not be educated in the technology, but they may not be ready for the looming liability shift either. According to an assessment by Javelin Strategy & Research, “Javelin’s projection falls long after the October 2015 deadline set by the card brands. After that date, fraud liability shifts to the party unable to service EMV transactions (fuel merchants have until October 2017 until they face a liability shift).”

Reports also indicate that issues are holding back due to uncertainty over debit routing technology, which has been an issue for a long time. However, since the report by Javelin Strategy & Research, a lot of these issues have been addressed. For example, according to ISO & Agent, since the report by Javelin Strategy & Research, debit networks and card brands have obtained a series of licensing agreements over the common application identifiers (common AIDs) needed to route debit payments.

According to Javelin, 166 million EMV credit cards will be circulating within the U.S. by the end of 2015; this only represents 29% of the actual and eventual total. In addition, EMV debit cards will have 105 million issued; this only represents 17% of the actual and eventual total. Based on these estimations, card ubiquity will take until 2018.

As eMerchantBroker.com says, “It may take the banks, high risk merchant accounts, and the consumers a little while to get all of the cards and readers up and running. But in the near future, the smart chip will enable all of us to breathe just a little better than we did. The strip will no longer tangle us in technology thievery and the chip brings us into a whole new world.”

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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