With almost every other developed country in the world now moving towards Chip and PIN EMV technology, the United States’ continued use of magnetic stripe cards has looked out of kilter for a while now. The reasons behind the US stance are complex, and some of them have been previously discussed, but it seems now that some important voices are calling for a change.
At the recent NACHA conference in Seattle, Walmart threw its weight behind the technology, announcing that their stores already have the hardware to accept Chip and PIN and that later in the year they will be accepting one, if not two, Chip and PIN programs. T-Mobile also backed a move to EMV, warning that ‘the US is becoming the weakest link in card fraud’ and that ‘banks need to listen to what merchants are asking for; if they don’t, other providers will step in.’ Some US issuers are also starting to issue EMV cards – at least for their high value customers, who an Aite Group shows frequently have problem using their non-EMV cards outside the US.
It’s good to see retailers putting their head above the parapet; and why not? The example set by the UK and Europe in terms of card fraud reduction is clear, and a few sums based on a 2009 Lexis Nexis survey show that US merchants could save around $50 billion by moving to EMV.
Although the US has not yet embraced a move to EMV, it has been extremely active in the fight against card fraud, deploying end-to-end-encryption and tokenization to strengthen security and protect cardholder data. Bob Russo, General Manager of the PCI Security Standard Council, hit the nail on the head in his concluding speech at last month’s RSA Conference, reminding his audience to stay focused on the fact that security is what’s paramount - the technology used is merely the tool. With this in mind, any measures taken can be considered positive. However, it’s worth remembering that implementing Chip and PIN in the US would have an immediate affect not only on US fraudsters’ ability to use another person’s card, but also on the cross-border fraud and usability loopholes that come from the US being out of step with the rest of the world.