Current Issues with Europay, Mastercard, Visa (EMV)

With several breaches in credit card security, like the infamous incident with Target, credit card companies and payment processors have stepped up their security with EMV chip readers. EMV, which stands for Europay, Mastercard, and Visa, stores data on integrated chips. These chips create a unique transaction code that cannot be replicated, whereas transactions from the magnetic stripe could be easily replicated through copying. The data on the magnetic stripe doesn’t change, which makes copying and replication easy.

Consumer support has been strong, and the increase in security is undoubtedly a success. Although, while EMV is innovative and more secure than magnetic stripes, it isn’t without flaws and issues.

October 1st of 2015 brought a liability shift for all merchants. Essentially, any companies that did not make the switch to EMV-compatible payment methods are now held liable for any breaches in security. Many small businesses are finding the transition and implementation difficult and expensive, which reduces their credit card transaction security, and makes them liable under the new EMV sanctions.

EMV transactions are driving more chargebacks than expected—this is especially prevalent in smaller businesses who have not integrated the EMV technology. Chargebacks are a result of a disputed charge, be it through fraud, processing errors, etc. With the new liability laws, merchants are now responsible for all chargebacks, and the number of chargebacks is increasing.

Customers and merchants are also noticing the longer length of verification is holding up lines, and slowing down operations ever so slightly. The average EMV transaction can go anywhere from 5 seconds to 20 seconds, but this time can be detrimental when added up. While the machine needs the time to process each transaction securely, our culture of convenience and speed can be reactive to longer waits and more steps.

The EMV card chips cannot be used in online transactions (card-not-present transactions), which may contribute to a rise in online fraud and theft, and possibly drive consumers away from online purchasing.

The chip cards used in the United States are not chip-and-PIN cards, meaning that a pin number is not required as it is with a debit card transactions. This is a security hole that must be reconciled if EMV cards are to provide maximum security.

Vision Payment Solutions understands the importance of payment security and EMV integration. If you need merchant payment solutions and advocacy, contact the professionals at Vision Payment Solutions for more information. We are pleased to assist you!