EMV The Future of Card Technology

EMV THE FUTURE OF CARD TECHNOLOGY I. What is EMV? A. Global standard for credit and debit transactions utilizing card chip technology and their respective acceptance devices. B. Acronym was taken from its developers: E M Europay Mastercard Visa D. Main Benefit C. Defining feature Use of cards embedded Enhanced security > reduction of fraud Traditional magnetic stripe Microprocessors E. Also known as: Smart card, chip card, and variations of II. EMV Chips Vs Magnetic Stripe A. Dynamic data > Static data i. Static data does not change and thus once stolen, fraud is easier to perpetrate EMV chips generate dynamic data unique to every transaction making them harder to counterfeit or hack i. III. Benefits of EMV A. Enhanced security - On 3 fronts: i. Card ii. Holder verification iii. Transaction verification authentication B. Statistical Proof UK i. Losses at retailers down 67% since ii. Lost and stolen card fraud down 58% between 2004 2004-2009 Canada i. Losses from "card skimming" down from CAD $142 million in 2009 C. Greater flexibility - 4 general ways to process payments: i. Tap & go using NFC technology ii. Chip & pin ii. Chip & signature ii. Chip & choice of pin or signature D. Global Payment Standard i. Currently emerging as the new standard for card transactions worldwide ii. The USA is following this shift IV. Liability Shift A. By Oct 2015 major credit card issuers will be implementing a fraud liability shift i. Liability will shift to whoever is LEAST EMV compliant ii. Meaning retailers who are EMV compliant will have zero liability for fraudulent transactions. B. EMV's future in numbers i. 1.1 BILLION EMV cards issued by 2015 ii. 13 BILLION Retail POS systems that need replacing to be EMV compliant v. 85% of Financial institutions that will issue EMV debit cards in the next 2 years iv. 70% of US credit cards that will be issued as EMV cards by the end of 2015 100 iii. 40% of US debit cards that will be issued as EMV cards by the end of 2015 Sources: http://www.smartcardalliance.org/publications-emv-faq/ http://www.creditcards.com/credit-card-news/emv-faq-chip-cards-answers-1264.php http://www.cardfellow.com/blog/emv-smartcards-ready-or-not-here-they-come/ LEAP PAYMENTS