Europay, MasterCard and Visa (EMV)
EMV chip technology is becoming the global standard for credit card and debit card payments. Named after its original developers (Europay, MasterCard® and Visa®), this smart chip technology features payment instruments (cards, mobile phones, etc.) with embedded microprocessor chips that store and protect cardholder data. This standard has many names worldwide and may also be referred to as: "chip and PIN" or "chip and signature."
Chip technology is an evolution in payment systems that will help increase security, reduce fraud and enable the use of future value-added applications. Chip cards are standard bank cards that are embedded with a micro computer chip. Some may require a PIN instead of a signature to complete the transaction process.
Simply put, EMV is the most recent advancement in a global initiative to combat fraud and protect sensitive payment data in the card-present environment. A cardholder's confidential data is more secure on a chip-enabled payment card than on a magnetic stripe (magstripe) card, as the former supports dynamic authentication, while the latter does not (the data is static). Consequently, data from a traditional magstripe card can be easily copied (skimmed) with a simple and inexpensive card reading device – enabling criminals to reproduce counterfeit cards for use in both the retail and the CNP environment. Chip (EMV) technology is effective in combating counterfeit fraud with its dynamic authentication capabilities (dynamic values existing within the chip itself that, when verified by the point-of-sale device, ensure the authenticity of the card).
Preventing the growth of fraudulent activity is one of the main reasons the industry is moving toward EMV technology. Chip cards make it difficult for fraud organizations to target cardholders and businesses alike. As a result, more and more chip cards are being introduced by U.S. financial institutions in order to support and switch over to this technology.
Here are the upcoming dates/deadlines/milestones for EMV Integration in the United States:
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- October 1, 2015 – Counterfeit Card Liability Shift. The party that has made investment in EMV deployment is protected from financial liability for card-present counterfeit fraud losses on this date. If neither or both parties are EMV compliant, the fraud liability remains the same as it is today. This date excludes automated fuel dispensers.
- October 1, 2017 – Counterfeit Card Liability Shift, Automated Fuel Dispensers. This extends the card-present counterfeit card liability shift to transactions from automated fuel dispensers.
- October, 2015 – Fraud Liability Shift. MasterCard liability hierarchy takes effect. The party that has made investment in the most secure EMV options is protected from financial liability for card-present fraud losses for both counterfeit and lost, stolen and non-receipt fraud on this date.
- October, 2015 – Account Data Compromise Relief: On this date, if at least 95% of MasterCard transactions originate from EMV-compliant POS terminals, the merchant is relieved of 100% of account data compromise penalties.
- October, 2017 – Fraud Liability Shift, Automated Fuel Dispensers. MasterCard liability hierarchy takes effect for automated fuel dispensers.
- March 15, 2012. Discover announced implementation of a 2013 mandate for acquirers and direct-connect merchants in the U.S., Canada and Mexico, to support EMV. Discover’s approach will support all card authentication channels (online and offline), all cardholder verification methods (including both chip and PIN or chip and signature transactions), and all commerce channels (contact and contactless, including mobile).
- October, 2015 – Fraud Liability Shift. American Express will institute a fraud liability shift policy that will transfer liability for certain types of fraudulent transactions away from the party that has the most secure form of EMV technology.
- October, 2017 – Fraud Liability Shift, Automated Fuel Dispensers. American Express fraud liability shift takes effect for transactions generated from automated fuel dispensers.