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Blog posts tagged with 'Liability Shift'

EMV - Rattling the Cage


Recent cyber criminal activity has created quite the fuss. One of their largest targets? Target.

Over the holidays Target customers had their data and information hacked at an alarming rate. Since then Targets profits have fallen by more then 40%. In an attempt to restore it's image and integrety among it's  customers, Target has vowed to replace all of their terminals to EMV, or smart card readers by the end of the year. In addition to proving their dedication to data security, Target will also be issuing "Red Cards" with an embedded chips.

So what?

Well this has gotten a few people talking. The EMV wake is coming, and much like a teenager putting off mowing the lawn, companies are waiting until the last minute. However, the reactive approach can cost not only Target, but private ATM Owners as well. We all know MasterCard's liability shift goes into effect October 1, 2016, giving us two years to be proactive and ensuring our equipment is updated and EMV ready. But if Target has shown us anything it's that companies were expecting to take the reactive approach.

Targert's motivation was drawn from their customers. Consumers are pushing politicians to get EMV over and done with as soon as possible so as to avoid any more breaches. To large companies such as Target and Macy's however, the convenience was the time that so many customers are hoping gets cut down. Over all consumer awareness will be what drives mandated educational programs on the corporate level so that businesses will be active listeners and proactive EMV advocates.

EMV: What it's costing America

How much is EMV Costing the U.S.?

Guess! Okay I'll tell you, but before I do lets go over some of the details:

Billions of credit cards have to be re-issued, 10 million POS cardreaders have to be replaced and we're still  a little over two years away from MasterCard's liability shift deadline.  Experts say it will cost the United States upwards of $35 billion! It's obvious that the train is moving and there is no stopping it but recently the push to get this transition over and done with has become more aggressive since the infamous Target breach over the holidays. 

France first switched over to smartcard technology back in 1992, now in 2013 americans are urging their government, retailers and banks to make the switch as quickly as possible. Following recent information breaches, Target alone has pledged to have all of their terminals switched over to smartcard readers by the end of the year, while also issuing out "red cards" for their customers with an embedded chip.

So why the late transition? Up until just a few years ago it wasn't seen as a necessity. We rolled with the punches and did what we could to get by, despite the fact that that an estimated $8.6 billion is lost each year to some form of fraud.  Countries like France and Columbia have seen massive improvements since adopting EMV (up to 98% decreases). However it took the U.S. much longer to realize how necessary the transition is.  To put it plainley, we waited for the worst to happen, and it's costing us money. 

We'll never know if we could have saved money had the transition been earlier in the millennium. Either way, we'll be saving billions of people from fraud, so the cost is justified.

-Sources MSN

EMV in the US

As we ponder this question, consider the most recent ATM theft in which organized thieves drained more than $45 million dollars from ATMs worldwide in mere hours. By accessing bank databases, cyber-thieves were able to eliminate maximum withdrawal limits on individual accounts, load customer data onto any plastic card with a magnetic stripe (a hotel room key would suffice) and use them to withdraw millions of dollars in cities around the world. Such a scheme isn’t that difficult to accomplish with the magnetic stripe technology we use today.      

The good news is that EMV is coming soon to an ATM near you. But “soon”
 is a subjective term. Most industry experts agree the primary driver for EMV migration in the U.S. will come from issuers, as they’re the ones tasked with replacing more than a billion mag-stripe credit and debit cards. This won’t be a singular event – but rather an ongoing process, where expired cards will be gradually replaced with EMV chip card technology. The shift will be subtle, and the card-holder may not even be aware of the change.

 

Before issuers can start providing customers with EMV smart-cards, they need a plan for accepting them at terminals. The first step towards accepting EMV smart-cards at the ATM is typically an assignment of liability:

• MasterCard is the first in the U.S. to publicly declare that if fraud occurs on a transaction initiated through an EMV card on a MasterCard, Cirrus or Maestro network, then the ATM owner will be liable for that fraud if the ATM was not properly equipped to support EMV technology. Visa has also announced dates for liability shifts, and other issuers in the U.S. will soon follow suit.

• In Canada, Visa was first to shift the liability to ATM owners. Within two years, all cards from Interact members (Royal Bank of Canada, CIBC, Scotiabank, Toronto-Dominion Bank, and the Desjardins Group of Credit Unions) featured EMV chip-cards.

While the October 2016 deadline for compliance in the U.S. moves closer, the message is clear: It’s time to get ready for EMV. This shift, which can take up to a year to complete, involves hardware, software and professional services to ensure compatibility on the back end.

-ATMTrader

 

EMV Deadlines

For what seems to be a decade of rumors and speculation, EMV has been on the back of everyone’s mind in the financial industry. Is it really happening? If so when, and what are we supposed to do?

March 2012 was the famous deadline date to adopt the 2010 ADA Standards. Then, just over a year later, in April of 2013, POS and ATM Maestro Processors had to have the ability to support EMV transactions in accordance to MasterCard and Visa.

The upcoming year will be focused on both the Windows 7 software migration as well as the EPP7 requirement to remain PCI compliant followed by VISA's April 2015 liability shift deadline lingers over ATM acquirer processors to support EMV transactions.

As for ATM distributors:

Why you should choose to remember October

At this point the major deadlines fall during in the months of October for the next three years.

October 1, 2015 will be the time when Counterfeit card fraud liability shifts to merchants for POS Terminals. (Except fuel selling automated terminals)

October 1, 2016 will be the liability shift to ATM Owners for fraud committed through any Mastercard debit cards. Meaning we need to be EMV compliant by this date!!

October 1, 2017 will be VISA’s EMV deadline for the liability shift to ATM Owners in regards to fraud committed through Visa debit cards. This significant EMV liability shift date will also include Fuel selling terminals.

ATMTrader.com will keep you in the loop of the EMV migration, bringing you the latest and most relevant news regarding important dates on upgrades and compliance issues.