Last October 2015, the big financial services corporations imposed a liability shift to all merchants in the United States as a response to the alarming increase of card fraud in 2014. The liability shift is aimed at convincing retailers to start supporting EMV chip cards on their sales transactions. EMV stands for Europay, MasterCard, and Visa.
In the United Kingdom, card fraud declined to about 63% since EMV was adopted. The United States is among the last of all developed countries to adopt this chip card technology, but just like in the UK, it expects to combat card-present fraud and secure the cardholders experience.
The year 2016 is bound to see an accelerated adoption of EMV in the United States. Phil Sealy, senior analyst at ABI Research, said, “EMV migration in the U.S. ramped up quickly, with market penetration likely to hit close to 100% over the next two years.” He added, “Our findings show that U.S. EMV shipments will peak in 2016 and reach approximately 617 million units. In 2017, shipments are forecast to dip approximately by 5% with later shipments likely to settle within the 600 and 615 million range.”
In Winona, Minnesota, a financial institution called Affinity Plus Federal Credit Union shared how their adoption of EMV paid off. They said that the company saw a 64% drop in fraud four months after adopting the chip card technology. The company’s president and CEO, Dave Larson, said: “Our decision to convert members’ cards to the most secure, up-to-date technology available really was a no-brainer for us. And based on our preliminary data, the reduction we have seen in fraudulent activity — combined with the overwhelmingly positive member sentiment and support we’ve received — makes this a win.”
The rollout of EMV provides opportunities for businesses in the U.S. to upgrade their payment options and improve the security of their checkout process. Jonathan Sepulveda, senior vice president of product delivery in the Bank of America, has a similar opinion. He said,”This may be a great opportunity for your business to look at upgrading your POS, or terminal, to best take advantage of the new liability shift, as well as provide you with more solutions and options for your business.”
If you still have doubts about shifting to EMV, you should consider the consequences of fraud losses compared to the costs you may incur by integrating EMV technology to your POS system. (PA)