Staying Ahead with Open – the Migration to EMV Chip Security Requirements2 min read
EMV technology was developed from the card schemes of Europay, Mastercard, and Visa, and has become the global standard for both credit and debit payment cards that are based on chip card technology. (EMV is an acronym bearing the first letter of each of the original cards schemes.) It’s basically everything having to do with processing credit and debit card payments with cards that feature a microprocessor chip. When such transactions are processed, they are generally known as “Chip and PIN” transactions, as PIN entering is a requirement on the part of the customer to provide verification of ownership, and EMV specifications include other methods of cardholder verification, too.
A Significant Change for the Better
This technology has evolved out of a need-based solution to the widespread proliferation of fraud in every type of merchandising venue in existence. Up front, it seems like a lot on the shoulders of merchants and financial institutions, who will need to add new in-store technology and systems for internal processing – and maintain compliance with liability rules. These cards are aggressively thwarting the card-counterfeiting business, and improving general payment security all around. It’s regarded as an important step for everyone as we move forward, technologically. Consumers will have new cards to activate and be learning new payment processes. All in all, EMV processing provides much greater fraud protection – a win-win, everywhere.
Existing Equipment Can Prove Costly
Among the FAQ, the subject of viability over keeping existing payment applications and just converting components over to handle the few transferrable merchant processes. EMV is worlds away from the older method of processing magnetic stripe transactions. Magnetic stripe-processed sales typically provide only the card number and the expiry date, where, with chip-processed sales, dozens of pieces of information are interchanged between the card, the terminal and the recipient bank (of the processor: you.) This is an elaborate and highly complex production with numerous differently timed stages that includes authentication via cryptographics within completion of the transaction. To utilize EMV with an existing system complex support would be a required addition, and the process could prove cost prohibitive, in both energy and expense. Many businesses needing an EMV Chip (and PIN or Signature) solution are electing to go with an EMV Software Kernel – straight off the shelf, instead of developing their own, in-house, due to EMVCo mandated testing, continually evolving specifications and regular updates.
It’s Where All Business is Headed
Statistics pertaining to both contact and contactless transactions of all chip cards showed an overall increase of EMV chip technology implementation rising 29 percent from 2013 to 2014. Currently, more than 3.4 billion EMV payment cards are in circulation, worldwide. This represents a yearly increase of 43%. While the figures on EMV chip-based transactions within the U.S. represent a smaller percent of the total, it’s clearly and rapidly becoming prevalent and expected technology of business leaders in the U.S.
