Understanding EMV

Now is the right time to begin embracing this new payment standard.


In recent years merchant groups and credit unions have been at odds on a number of issues, including interchange rates and network routing. However, there is near universal agreement among both parties on the need to implement EMV chip technology in the United States. EMV, which stands for Europay, MasterCard, and Visa, uses an embedded microchip to validate a debit or credit card with the payment transaction each time the card is used. It offers increased security over the static magnetic stripe technology used on cards in the U.S. today and greatly improves both credit unions’ and merchants’ capacity to combat fraud.

The problem with mag-stripe cards is that the data on them can be easily copied, or skimmed, using a card reading device. Once the card information is skimmed, criminals can make counterfeit cards to defraud both credit unions and merchants at ATMs, point-of-sale devices, or even through online transactions.  Conversely, chip-embedded cards support dynamic authentication for each transaction and can eradicate card-skimming or other common forms of offline and online card fraud.

In addition to greatly reducing fraud, implementing EMV technology in the United States will speed up the emergence of mobile and contactless payments, including Near Field Communication (NFC)-based options. This is critically important to all key stakeholders, including issuers, acquirers, and merchants. Likewise, credit unions also stand to make their cards more top-of-wallet by emphasizing the enhanced features of EMV, which will help drive increased transactions. Given the fact that U.S. consumers have an average of 5.4 cards in their wallets, ensuring a loyal relationship here is key to retaining members in the long term.

This migration to EMV is happening sooner than many might think. On October 1, 2015, Visa will shift the financial liability for card-present counterfeit fraud losses from the issuer to the party that is the cause of the chip transaction not occurring. In many cases, this means the merchant.  Now that all the major card networks – Visa, MasterCard, American Express, and Discover – have developed a roadmap for EMV adoption, most merchants will begin the process of converting to chip compatible terminals within the next year or two. 

Credit unions can also begin to plan for EMV right now.  Budgeting for card migration can be spread over a two- or three-year period for both debit and credit programs.  Also, anticipate a minimum of six months to start the migration process with core processing and card services vendors.  Finally, be prepared to educate members about the benefits of EMV.

Member Access Pacific (MAP) is already putting in place the tools to ensure client credit unions can make a smooth transition to EMV. To assist credit unions over the technical hurdles associated with this migration, MAP is offering a fully integrated solution and management program based on best practices gained by its card production partner, Oberthur Technologies.  Oberthur is the largest EMV provider in the U.S. and has experience from hundreds of EMV projects worldwide.

At MAP, we strive to make our clients more competitive by providing payments solutions that best serve their members. Our success comes from providing cost effective, best-in-class solutions for our clients. For more information about how MAP can best serve you and your institution, contact Cyndie Martini,president and CEO of Member Access Pacificat 1-866-598-0898, ext 1610 or cyndie.martini@mapacific.com.



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