The Green Sheet Online Edition
November 10, 2014 • Issue 14:11:01
Preparing your clients for EMV
Preparing your clients for EMV
By Michael Gavin
Merchant Warehouse
If you are a professional, you have most likely heard of the upcoming shift to EMV in the United States. The acronym EMV stands for the three companies that initially promulgated the global standard for chip cards: Europay International, MasterCard Worldwide and Visa Inc. (In 2002, Europay merged with MasterCard.) EMV is central to a major effort to reduce fraud in the United States.
With this transition, card issuers will be distributing new cards to consumers, and businesses will be purchasing EMV-capable equipment. However, some small businesses may not be aware of EMV or may not feel the need to make the switch. It is critical to get a better understanding of EMV so you can prepare your prospects and existing customers for the upcoming migration. Providing valuable advice and helping your customers make a smooth transition will be appreciated and can build stronger relationships with your customers.
EMV has been around since the early 1990s, and many major markets, including Canada, Europe and Asia, have used it for years. So why has it taken so long for the United States to adopt it? Cost has been the primary barrier to adoption due to changing merchants' equipment over to EMV-capable readers and issuing new credit and debit cards to consumers. Implementing EMV in the United States is an extremely costly, but necessary, initiative. In its 2011 report EMV in the U.S.: Putting It into Perspective for Merchants and Financial Institutions, First Data Corp. estimated the cost of EMV implementation to total $8 billion.
The EMV adoption was also delayed in the United States due to a lack of demand from consumers. However, with the recent data breaches, including major retailers Target Corp. and Neiman Marcus, consumers are now recognizing the need for more secure payment methods.
Some consumers are already anxiously awaiting their new cards. According to "Why Consumers are Itching for EMV Cards," published by Pymnts.com on July 23, 2014, a recent MasterCard survey indicated 57 percent of American consumers are expecting to receive their EMV chip cards in the mail within six months. Although some consumers may not fully understand the technology behind the EMV chip cards, they are aware of the enhanced security and will feel more comfortable making purchases with their EMV chip cards.
U.S. consumers have already started to receive EMV chip cards from major credit card issuers and banks. These EMV chip cards have embedded microchips that encrypt transaction data uniquely for each transaction. Today, Americans swipe credit cards that employ a magnetic strip (mag stripe) on the back. However, Marc Castrechini pointed out in "What is EMV?," published by Merchant Warehouse on July 12, 2012, that this mag stripe stores the transaction information the same way for every transaction, making it easy for thieves to steal consumers' information and create counterfeit cards.
With EMV, consumers will insert chip cards into EMV-capable terminals and will be asked to either sign or enter a personal identification number (PIN). While consumers quickly swipe cards today, this will be a different POS process; however, it will enhance the security of consumers' sensitive payment data, which will lead to a reduction in fraudulent transactions in the United States.
Merchant Warehouse
If you are a professional, you have most likely heard of the upcoming shift to EMV in the United States. The acronym EMV stands for the three companies that initially promulgated the global standard for chip cards: Europay International, MasterCard Worldwide and Visa Inc. (In 2002, Europay merged with MasterCard.) EMV is central to a major effort to reduce fraud in the United States.
With this transition, card issuers will be distributing new cards to consumers, and businesses will be purchasing EMV-capable equipment. However, some small businesses may not be aware of EMV or may not feel the need to make the switch. It is critical to get a better understanding of EMV so you can prepare your prospects and existing customers for the upcoming migration. Providing valuable advice and helping your customers make a smooth transition will be appreciated and can build stronger relationships with your customers.
EMV has been around since the early 1990s, and many major markets, including Canada, Europe and Asia, have used it for years. So why has it taken so long for the United States to adopt it? Cost has been the primary barrier to adoption due to changing merchants' equipment over to EMV-capable readers and issuing new credit and debit cards to consumers. Implementing EMV in the United States is an extremely costly, but necessary, initiative. In its 2011 report EMV in the U.S.: Putting It into Perspective for Merchants and Financial Institutions, First Data Corp. estimated the cost of EMV implementation to total $8 billion.
The EMV adoption was also delayed in the United States due to a lack of demand from consumers. However, with the recent data breaches, including major retailers Target Corp. and Neiman Marcus, consumers are now recognizing the need for more secure payment methods.
Some consumers are already anxiously awaiting their new cards. According to "Why Consumers are Itching for EMV Cards," published by Pymnts.com on July 23, 2014, a recent MasterCard survey indicated 57 percent of American consumers are expecting to receive their EMV chip cards in the mail within six months. Although some consumers may not fully understand the technology behind the EMV chip cards, they are aware of the enhanced security and will feel more comfortable making purchases with their EMV chip cards.
U.S. consumers have already started to receive EMV chip cards from major credit card issuers and banks. These EMV chip cards have embedded microchips that encrypt transaction data uniquely for each transaction. Today, Americans swipe credit cards that employ a magnetic strip (mag stripe) on the back. However, Marc Castrechini pointed out in "What is EMV?," published by Merchant Warehouse on July 12, 2012, that this mag stripe stores the transaction information the same way for every transaction, making it easy for thieves to steal consumers' information and create counterfeit cards.
With EMV, consumers will insert chip cards into EMV-capable terminals and will be asked to either sign or enter a personal identification number (PIN). While consumers quickly swipe cards today, this will be a different POS process; however, it will enhance the security of consumers' sensitive payment data, which will lead to a reduction in fraudulent transactions in the United States.
