As I drove out of a parking garage last week I began to dig for the $1 payment I needed to make. After frantically searching for the duration of my wait in line, I meagerly pulled out my debit card and apologized to the lady working. She assured me it happens ALL the time, but seriously, how dependent are we on the plastic in our wallets that we can’t even round up $1 to pay for parking?! It shouldn’t be that shocking; there have been several times I’ve eased out of line at a drive-through, left my merchandise with the sales clerk, or rushed to a nearby ATM, conveniently located with a $5 fee, due to a non-functioning credit card machine.
EMV Compliance – Benefits to Consumers
The information comes full circle in “The Survey of Consumer Payment Choice” conducted by the Federal Reserve Bank of Boston. RetailCustomerExperience.com published a white paper, “Reducing Credit Card Fraud: Three Steps for Successful EMV Implementation”, delving into the increase of “plastic money” and what that means for fraud. According to the publication, in 2009 80% of consumers had a debit card and 78% had a credit card. That seems obvious, but what does it mean for the security of our information? It means large numbers of the population are vulnerable for credit card fraud; 32% of US consumers reported credit card fraud in the past five years according to a 2010 survey by ACI Worldwide, which supplies payment systems to financial institutions, processors and retailers.
That’s a scary piece of information, but technology is available to combat fraud. EMV (Europay, MasterCard, Visa standard) is a global card-security standard that has significantly reduced fraud where adopted. EMV is an embedded chip technology that has proven far more difficult for thieves to counterfeit than the traditional magnetic stripe. Finally, EMV is coming to the United States. By October 2015, Visa will require all point-of-sale transactions in the US to be EMV compliant, while MasterCard wants merchants to be compliant by April 2013.
EMV Compliance – Business Implementation
As a consumer, it’s comforting to know these security measures are being implemented, but for a retailer it can seem like a disconcerting implementation process. The whitepaper discusses the benefits of EMV and the steps retailers should take to become compliant. The steps are simplified; step one – hardware, step two – software, step three – service. The benefits for retailers include:
- Reduced fraud liability
- More applications, such as stored-value cards, e-purse and loyalty apps
- Better payment security
- Closer compliance with PCI standard
Once EMV compliance is reached, merchants and restaurant operators should see benefits from payment processors and will be able to offer better payment security to their customers. To read the full whitepaper click here or to check out an overview of the 2012 survey click here.