• image
  • image
twitter linkedin email rss

Chip & PIN rolled out to Canada & USA

VISA and MasterCard have announced that they will be introducing EMV Chip & PIN technology to retailers in Canada in the coming months, with a full North America roll out planned for 2013.

The announcement, made earlier this month, marks a significant transition for MasterCard and Visa, who have so far been reluctant to publicly confirm or deny suggestions of EMV Chip & PIN usage in Canada and North America.

“Recent developments have convinced us that the time is now right to put real incentives in the marketplace for contact and contactless chip technology to take hold, “ wrote Visa’s Chief Enterprise Risk Officer, Ellen Richey in her blog. “With our news today, Visa is leading the way for the widespread commercial deployment of EMV technology in the U.S. The programs we are announcing are designed to enable dynamic authentication, improve fraud prevention, enhance international acceptance, and provide a commercial framework to support the acceleration of NFC mobile payments,” she continued.

To incentivise merchants to sign up to the Chip & PIN technology, VISA will introduce it’s Technology Innovation Program (TIP) to the USA and remove the PCI Data Security Standard requirement for those merchants who complete at least 75% of the Visa transactions from chip-enabled terminals. These merchants must ensure that they do not store any sensitive data and still adhere to the PCI DSS standards where necessary, but removing some of the requirements of PCI compliance is likely to be appealing.  

In addition to overall higher levels of security, MasterCard has reassured merchants that any cost of implementation of the EMV Chip & PIN technology will be outweighed by reduced fraud, increased operational efficiency, increased speed at the check-out and flexibility for future applications.

From October 2015, VISA will shift their liability for fraudulent card present transactions to the merchant’s acquirer, if a Chip-enabled card has been presented and the merchant has not deployed EMV capable terminals. Fraudulent automated fuel transactions will be covered by the current practices until October 2017. VISA hopes this shift in liability will encourage a swift deployment of EMV cards and terminals by banks and acquirers. 

Merchant acquirers will have to support Chip & PIN transactions no later than April 2013. Acquirers will need to process and carry the additional information that makes each transaction unique, and support will come from VISA in the form of it’s bi-annual Business Enhancements Release.

“We welcome the introduction of Chip & PIN to the USA and Canada”, says Chris Jarman of Secure Electrans. “Whilst the payment schemes continue to experiment with NFC and contactless payments, the global dominance of Chip & PIN as a secure interoperable standard continues. The goal of Secure Electrans is to capitalise on these deployments and extend the usage from the retail to the eCommerce channel. Technological advances, such as the HomePay platform, offer consumers at home the same secure Chip & PIN payment experience they are used to in shops. And with e-Commerce revenues in the US set to top $250bn by 2014, the opportunities for fraud reduction are huge. HomePay turns Card-Not-Present into secure Card-Present/PIN verified transactions bringing peace of mind to consumers and reduced costs to merchants.“

During the transition period, Visa will continue to support a variety of cardholder verification platforms. These will include signature, PIN and no-signature for lower value, low-risk transactions. However, Visa has indicated that it expects existing processes such as signature and PIN to be phased out in due course.

Posted on 31/08/2011 by Secure Electrans