EMV Technology and the United States Consumer
EMV, also referred to as Europay, MasterCard and Visa, is the process of operation for integrated circuit cards (IC cards) and IC-capable POS stations.
Operating as a joint effort between MasterCard, Visa and Europay, this new technology was created to provide user security and global usage for Visa and MasterCard owners.
EMV technology is globally operational and can be used seamlessly for: • ATMs • Contact card transactions • Contactless card transactions • Mobile transactions • eCommerce or online transactions How EMV Technology Works The overall flow of payments is the same with EMV as with other credit card transactions, but EMV also utilizes an authentication with its built-in chip technology, which results in higher security for all EMV-related transactions.
The overall process includes: • A card authentication through online or offline encryption • Cardholder verification to ensure the person using the card is authorized to charge on it • A final transaction authorization that can be complete online or offline using issuer-created parameters EMV technology still protects the consumer during "card not present" transactions, such as over the phone or through mail order.
To process a "card not present" transaction, the merchant must manually input the PAN key entry, expiration date, and the three-digit security code for the card to process the authentic authorization.
Why Use EMV Technology? Today's payment industry is ever-changing.
With technology rapidly evolving, merchants and consumers need something that can keep up.
Tech-savvy consumers rely on their digital devices, especially when it comes to making payments quick and convenient.
Since merchants are under pressure from credit card issuers, consumers, and acquirers to create stricter security and transaction safeguards, more merchants are turning to the use of EMV.
Why EMV Technology is Important to United States Consumers A study conducted by ACI Worldwide in 2010 determined that one out of every three United States consumers reports a form of credit card fraud in a five year period.
With the instances of credit card fraud increasing, European merchants are only allowing the use of an EMV card.
The United States, however, is limited on using this technology, even though the numbers of credit card fraud continue to grow.
Issuer Plan for EMV Technology in the United States United States issuers are hesitant to use EMV technology because the cost to create the cards and convert POS and ATM technology is extensive and expensive-especially on a nationwide scale.
In order to encourage the use of EMV in the United States, issuers like Visa and MasterCard are creating an EMV strategy: • Offering business incentives: Visa and MasterCard plan to eliminate the requirement for the annual PCI data security if the merchant accepts over 75 percent of EMV transactions.
Since this requirement drop will significantly lower costs for businesses and eliminate the time-consuming audits, businesses may benefit more from using EMV technology.
• Creating chip acceptance infrastructures: By 2013, Visa and MasterCard will require United States-based chip processors to support all mechanical chip transactions.
This means that merchants are required to carry chip-processing capabilities, which includes dynamic authentication.
• Shifting liability: Credit card issuers and merchants typically take the hit for credit card fraud and chargeback costs.
In October 2015, Visa and MasterCard plan on shifting this responsibility.
When fraud does occur, if the merchant was not utilizing a contact chip terminal, he is responsible for all fraud charges-not the issuer.
As a merchant, you want to protect your business from chargeback liability and ensure your customers are protected while using your services.
You need a merchant processing provider that offers EMV services that can provide your company with safe, secure EMV payment processing that not only protect your customers, but your business as well.
Operating as a joint effort between MasterCard, Visa and Europay, this new technology was created to provide user security and global usage for Visa and MasterCard owners.
EMV technology is globally operational and can be used seamlessly for: • ATMs • Contact card transactions • Contactless card transactions • Mobile transactions • eCommerce or online transactions How EMV Technology Works The overall flow of payments is the same with EMV as with other credit card transactions, but EMV also utilizes an authentication with its built-in chip technology, which results in higher security for all EMV-related transactions.
The overall process includes: • A card authentication through online or offline encryption • Cardholder verification to ensure the person using the card is authorized to charge on it • A final transaction authorization that can be complete online or offline using issuer-created parameters EMV technology still protects the consumer during "card not present" transactions, such as over the phone or through mail order.
To process a "card not present" transaction, the merchant must manually input the PAN key entry, expiration date, and the three-digit security code for the card to process the authentic authorization.
Why Use EMV Technology? Today's payment industry is ever-changing.
With technology rapidly evolving, merchants and consumers need something that can keep up.
Tech-savvy consumers rely on their digital devices, especially when it comes to making payments quick and convenient.
Since merchants are under pressure from credit card issuers, consumers, and acquirers to create stricter security and transaction safeguards, more merchants are turning to the use of EMV.
Why EMV Technology is Important to United States Consumers A study conducted by ACI Worldwide in 2010 determined that one out of every three United States consumers reports a form of credit card fraud in a five year period.
With the instances of credit card fraud increasing, European merchants are only allowing the use of an EMV card.
The United States, however, is limited on using this technology, even though the numbers of credit card fraud continue to grow.
Issuer Plan for EMV Technology in the United States United States issuers are hesitant to use EMV technology because the cost to create the cards and convert POS and ATM technology is extensive and expensive-especially on a nationwide scale.
In order to encourage the use of EMV in the United States, issuers like Visa and MasterCard are creating an EMV strategy: • Offering business incentives: Visa and MasterCard plan to eliminate the requirement for the annual PCI data security if the merchant accepts over 75 percent of EMV transactions.
Since this requirement drop will significantly lower costs for businesses and eliminate the time-consuming audits, businesses may benefit more from using EMV technology.
• Creating chip acceptance infrastructures: By 2013, Visa and MasterCard will require United States-based chip processors to support all mechanical chip transactions.
This means that merchants are required to carry chip-processing capabilities, which includes dynamic authentication.
• Shifting liability: Credit card issuers and merchants typically take the hit for credit card fraud and chargeback costs.
In October 2015, Visa and MasterCard plan on shifting this responsibility.
When fraud does occur, if the merchant was not utilizing a contact chip terminal, he is responsible for all fraud charges-not the issuer.
As a merchant, you want to protect your business from chargeback liability and ensure your customers are protected while using your services.
You need a merchant processing provider that offers EMV services that can provide your company with safe, secure EMV payment processing that not only protect your customers, but your business as well.