EMV – The Horse is Out of the Barn

Parker Burke's picture
Parker Burke : Marketing Director, Media Systems

At Gilbarco’s recent Retail Technology Conference, Gray Taylor of Conexxus (formerly PCATS) spoke alongside Robin Trickel, Executive Director of Product Compliance at Heartland Payment Systems, and Oliver Manahan, VP of Emerging Payments Technologies at MasterCard.  During the discussion, Gray highlighted the growing acceptance of the currently established liability shift deadlines from the card associations by stating that “the horse [EMV] is out of the barn”.  While retailers still seem skeptical about these deadlines, the card associations appear serious about holding merchants (i.e. – retail petroleum operators) and credit card issuers liable for fraudulent transactions on non-EMV capable terminals.  Gray concluded his comments by urging retailers to “start today!”

Gray’s comments come on the backs of statements by both MasterCard (in a letter from their President on January 8, 2014) and Visa (in their Q1 2014 Earnings Release) that they have no intention of moving the currently established dates.

In his Jan 8, 2014 letter to financial institutions, merchants and other customers, MasterCard’s North American President Chris McWilton reiterated, “This migration is about an upgrade that will drive both innovation and security for all of us and, more importantly, consumers and cardholders. The fraud liability shifts we have announced provide incentives to migrate to EMV and not a mandate. Over the past two years, we have been impressed with how the industry has come together to prepare and plan for this migration.”  He continued by saying “that is why we will keep our 2015 liability shift dates – to help maintain this momentum and address the larger fraud threat. As we’ve seen recently, the fraudsters will not delay their activities. Any delay in the liability shift dates would potentially increase the U.S.’s disproportionate share of the world’s fraud losses.”

Visa’s CEO Charlie Scharff  echoed McWilton’s comments in Visa’s Q1 earning release, stating “In 2011, we had announced a plan to migrate the U.S. to EMV technology through a liability shift beginning in October 2015 and we have reaffirmed these dates.”  He continued “EMV, to be clear, would potentially eliminate the ability to reproduce the card and thereby reduce if not eliminate counterfeit fraud at the point of sale”

As recently as May 28, in an interview with CSP’s Angel Abcede (Visa Holds EMV Stance), Visa’s Chief Enterprise Risk Officer and Chief Legal Officer Ellen Richey reaffirmed the currently established dates.  In the discussion she explicitly stated that the reason for the two additional years to October 2017 was to allow petroleum retailers adequate time to prepare for “terminal replacement cycles” with EMV upgrades occurring naturally from the time of their initial announcement in August 2011.

With these announcements from the card associations and follow-on comments from industry insiders, retailers should begin mapping out their migration timelines today.  Those that wait risk running into technician and installation bottlenecks, risking increased liability for fraudulent transactions at the pump.

Additional Information:

For additional resources on the EMV migration to the US, please see:

  1. Gilbarco’s EMV informational web-page
  2. Previous Gilbarco blog posts on EMV:
    1. September 2011 – VISA announces EMV roadmap to the United States
    2. February 2012 – Another “Chip” Falls – MasterCard Follows Visa’s EMV Lead
    3. December 2012 – EMV Migration to the United States – What Convenience Store Retailers Need to Know
    4. March 2014 – Creating an ROI to the EMV Migration
  3. Product Opportunities to create an ROI from the EMV Migration

For the latest on emerging payment technologies, follow Parker on Twitter – @MobileAtThePump

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