The Impact of EMV Cards

While the U.S. has been slow to adopt EMV credit cards, or what some call ‘smart credit cards’ , that is about to change. The big card providers (Europay, Mastercard, and Visa), have announced a roll out of EMV technology in October 2015, a change that will help decrease fraud and allow card providers more control of off-line transaction approvals. The cards will feature an embedded chip that can literally communicate with the card’s bank servers..

The Cost

While few experts criticize the technology itself, there are critics of the implementation essentially because of its high cost. EMV cards will impact business, specifically retail business, by costing the retail industry a large portion of the $7 billion dollar price tag. Shouldering so much expense is going to be a significant burden for the retail industry, with new pos equipment being a significant portion of the outlay.

Not All Fraud will Decrease

Experts believe that while some fraud will drastically decrease, it is likely that “card-not-present transactions” will increase. Ecommerce dealers will feel a sting as a result of this expected fraud spike. The industry does not want to trade one set of problems for another. This is one of the reasons the U.S. has been slow to adopt this technology in the hopes that more solutions can be found to safeguard against alternative types of credit card fraud.

In spite of the risk of other types of fraud and the high cost of implementing EMV technology, the big card providers believe the pros far outweigh the cons. Already, EMV technology is making its way into American credit cards. Issuers that remain slow to adopt leave themselves open to continued fraud risk. However, the sooner they adopt this new technology, the sooner that will enjoy greater fraud protections.

Harbortouch America can help you transition to the new EMV technology with FREE EMV card readers for any new merchant pos system account.

Aug 25, 2015

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