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Forums » Currency & Credit Cards » New report on coming U.S. EMV shift


New report on coming U.S. EMV shift

by PHeymont »

Here's a useful background piece from a payments industry publication on some of the choices in implementing EMV (chip-based) cards in the U.S. over the next few years. The "liability shift" referred to begins its first steps soon; it means that while the card-issuer now takes the loss for fraudulent transactions that get by its verification network, once the shift happens, any merchant who does not use the most secure technology available from the network to verify the transaction will pay the loss.

That means that if a chip-based verification is available, but the merchant just swipes the card, he's on the hook for bad sales. And since chip-based verification is now being implemented by U.S. card issuers, that will be the "most secure" available. 

However, the article assumes that chip-and-signature will be easier to implement in the U.S., although it is far less secure than PIN verification because it's what U.S. cardholders are used to. I beg to disagree: With the increasing use of MC or Visa branded ATM cards at retail, plus the growing use of stand-alone debit cards such as the Chase "Liquid" product, PIN-based transactions have become very familiar to U.S. cardholders. Add in the PIN-based interaction with the ATM itself, and it's hard to make an argument that chip-and-PIN would represent such a huge leap for U.S. consumers. Not to mention, it would rebut the assumption that U.S. consumers are too stupid or lazy to make a change. Remember, these are the same people who successfully transitioned from paper to e-readers, from snail mail to e-mail, etc.


RE: New report on coming U.S. EMV shift

by pdhenry »

The leap probably comes in consumer association of a PIN with a debit transaction and a signature with a credit transaction.