EMV Overview by DPS
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EMV Overview by DPS



"EMV® is a global standard for credit and debit payment cards based on chip card technology" taking its name from the card schemes Europay, MasterCard, and Visa that developed it. The standard covers ...

"EMV® is a global standard for credit and debit payment cards based on chip card technology" taking its name from the card schemes Europay, MasterCard, and Visa that developed it. The standard covers the processing of credit and debit card payments using a card that contains a microprocessor chip at a payment terminal.



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EMV Overview by DPS Presentation Transcript

  • 1. EMV OverviewPREPARED AUGUST 2012
  • 2. INTRODUCING DPS | PAYMENT EXPRESSWE EMPOWER WE EXECUTE WE UNDERSTANDPAYMENT TECHNOLOGY FOR THE ATTITUDE AND KNOWHOW TO PAYMENTS TO THE FULL,YOUR ADVANTAGE CONSTANTLY DELIVER GREAT RESULTS AND WORK WITH A LEADING NETWORK OF PROVIDERS Industry leading payment solution providerSOLUTIONS SCHEME PARTNERSInnovative full-end-to-end Interwoven team OUR Product innovation.  VISAcloud-based payment platform ESSENCE skills striving to Excellence in  MasterCard provide the best deployment and  AMEX / JCBE-Commerce  solutions support  Diners  DiscoverOn/Off Street Parking  OUR  China Union Pay HOW WE EXECUTION PEOPLEVending  CONVERT OUR BANKING RELATIONSHIPS TECHNOLOGYPOS Terminals  FOR YOUR ADVANTAGE  ANZ  ASBFull Web-Based Reporting   Bank of New Zealand  Bank of South Australia Openness, Leaders in  Bank West OUR CULTURAL enthusiasm,  Barclaycard payment and a passionOUR SERVICES development VISION FIT for customer  BOQ satisfaction  CitigroupCore disciplines for your advantage  Commonwealth Bank  Elavon Europe 24/7 Support Service   EMS SNAPSHOT EVIDENCE  HSBC UK Project Management   HSBC International DPS AT A GLANCE OUR CREDENTIALS  Kiwi Bank  National Australia Bank Development   Established 1997  15,000+ merchants  Standard Bank South Africa  Subsidiaries in Sydney,  Direct VISA link  Standard Chartered (Asia) Quality Assurance  New York and London  Per $20b of transactions p.a  St George  Certified in 10+ regions with  Exceeds global security  US Bank (Elavon)  Wells Fargo Business Analysis  multiple banks and schemes standards   All IP and infrastructure  Largest independent IP Westpac AU / NZ owned by DPS Payment Gateway in  Westpac Pacific Islands Australasia
  • 3. UNDERSTANDING EMVWHAT IS EMV? EMV is a global standard for credit and debit payment cards based on chip card technology EMV is also known throughout the world as “Chip and PIN”, ICC, and “IC Credit” EMVCo is the governing body maintaining EMV specifications and Approvals EMVCo members are American Express / JCB, MasterCard, and Visa Advanced security measures and advanced cryptography reduces exposure to fraud Aims to establish a common foundation for global payments and acceptance
  • 4. UNDERSTANDING EMVWHY GO EMV? Global interoperability of services Secure contactless payment methods – reflects current trends in technology Allows for offline card verification and approval Designed for the future, allowing the delivery of payments beyond traditional mag strip cards Carries Risk Management Parameters to reduce unauthorised payment risks Digitally signs payment date for reduction of fraudulent transactions via advanced security Protects against counterfeit fraud through authentication of the chip card
  • 5. TERMINOLOGYKEY WORDS EMV - Europay, MasterCard and Visa developed standard to reduce transaction fraud EMV Level1 - Covers physical, electrical and transport level interfaces EMV Level2 - Covers payment application selection and transaction processing NFC - Near Field Communication (used in smart phone / m-commerce payments) PCI - Payment Card Industry Standards Security Council that sets payment security standards CAT/UPT - Cardholder Activated Terminal/Unattended Payment Terminal PCI PTS 3.x – PCI Device certification, formerly PCI PED. No Customer Verification Method - No CVM 2 Key Triple Encryption - K1 !=K2; K1=K3 - Data Encryption Standard – 168 bit encryption Digital Signatures - Data authentication PCI-DSS - Payment card industry data security standard Unattended/Attend/Semi-Attended - Levels of supervision for card readers
  • 6. UNDERSTANDING EMV THE EMV PROCESS Application Selection & Offline Data Reading Authentication Card Holder Verification Terminal Risk TerminalDetermine the Assessment Card Actionapplication to use Static Data Action Analysis(Visa, MasterCard) Authentication (same Analysis e.g. signature, PIN,& then reads the Key), dynamic Data No CMV Terminal decides ondata Authentication (a e.g. Floor Limits what it is going to ask TC – Offline new key each time) the card Approval | ARQC – Online Authorisation | AAC – Offline Decline Terminal Verification Results
  • 7. UNDERSTANDING EMVLEVEL 1 – L1 EMV KERNEL APPROVAL Designed to ensure the TERMINAL CHIP READER conforms to the EMV SPEC The transfer of data between the credit card and terminalLEVEL 2 – L2 EMV KERNAL APPROVAL Designed to ensure the SOFTWARE conforms to the EMV SPEC EMV Applications i.e Payments. Non-EMV application functions such as POS hardware. Messages to an Acquirer host are not viewed as a KERNEL function Terminal Application EMV Kernel High Level API EMV Certifiable Lower Level API Terminal HardwareLEVEL 3 – END TO END APPROVAL Certifying Device; Software, Gateway & Switch with Merchant’s Acquirer and Schemes e.g. Visa ADVT and MasterCard MTIP certifications
  • 8. EMV AT WORK CARDHOLDER / ATTENDED BY MERCHANT EXPERIENCEStep 1 – Swipe card Service Code = 2xx “2” = Chip Present “Please insert the Chip Card”
  • 9. EMV AT WORK CARDHOLDER / UNATTENDED EXPERIENCE Step One Step 2 Insert into dual Chip & Leave in reader but retain Track2 magstripe [non possession of the card until motorised] reader prompted to remove after transaction completed
  • 10. EMV AT WORKOFFLINE VS. ONLINE PIN Self selection of PIN to cardholders should typically be offered by issuers A secure process for PIN change and PIN unblock will be necessary (if PIN is forgotten) Synchronisation must occur when the online or offline PIN is changed Online PIN is in the Issuer’s Host Issuer Host Offline PIN is in the Chip
  • 11. WHERE IN THE WORLD IS EMV? Canada Europe • 66% of cards • More than 70% of cards • 75% POS are EMV • More than 40% of ATMs • 90% of ATMs/POS are EMV EMV enabled Asia Pacific • 30% penetration of cards and over 50% of POS services • ATM migration growing over 200% year on year Latin America Middle East & Africa • More than 80% of • 7 markets at over 40% EMV acceptance now EMV infrastructure penetration enabled • 10 markets at over 80% ATM • Most prominent in Brazil, penetration Mexico, Peru, Venezuela • EMV year on year growth of and Colombia 36% cards, 25% POS and 39% ATM’sData sourced from MasterCard, May 2012
  • 12. WHERE IN THE WORLD IS EMV? GLOBAL EMV STATISTICS PART A Region EMV CARDS Adoption Rate EMV Terminals Adoption Rate Canada, Latin 182,185,043 26.4% 2,000,000 55.6% America and the Caribbean Asia Pacific 305,126,927 26.6% 3,200,000 41.6% Africa & the Middle 16,841,874 13.7% 348,000 62.5% East Europe Zone 1 555,688,434 65.4% 9,400,000 84.7% Europe Zone 2 22,817,271 11.5% 457,800 61.2% Total 1,082,659,549 36% 15,405,800 65%Figures sourced from American Express, JCB, MasterCard and Visa. As reported by their member financial institutions globally
  • 13. WHERE IN THE WORLD IS EMV? GLOBAL EMV STATISTICS PART B 1 Billion+ Global EMV-Compliant cards 18 Million Global EMV-compliant POS Terminals +60% Global EMV penetration (75% excl. US) +18% Global EMV Card growth rate (mid 2010-mid 2011) +32% Global EMV POS terminal growth rate (mid 2010-mid 2011) 633 Million+ EMV MasterCard-branded cards (35% of all MasterCard cards) EMV-compliant ATM terminals that accept MasterCard-branded EMV cards 20 Million+ (39% of all MasterCard ATM terminals) EMV POS terminals that accept MasterCard-branded EMV cards (62% of 740,000+ all POS terminals accepting MasterCard) 100 Million+ New MasterCard-branded EMV cards each year 3,000+ MasterCard Chip Migration Services delivered globally 1,700+ Customer banks supported on EMV Chip deployment to date 130+ Countries in which EMV is being rolled out for MasterCard productsSourced from MasterCard customers, regional offices and QMR May 2012
  • 14. US LIABILITY SHIFTUNDERSTANDING THE SHIFT Liability shift for domestic and cross-border counterfeit card- present point-of-sale (POS) transactions A card-present counterfeit fraudulent chip enabled card transaction is performed on a Non-EMV POS device the liability shifts to the merchant If performed on a EMV approved device then the liability shifts to the issuer / acquirer Merchant needs to discuss with their Acquirer how this liability shift applies to them
  • 15. HOW WILL IT AFFECT THE PARKING INDUSTRY?KEY IMPACTS EMV incorporates advanced encryption algorithms, increasing security and reducing fraud Will help decrease losses from card-related fraud by enabling cardholder verification methods, which can offset CAPEX investment With the implementation of “contactless”, payment and exit times are accelerated which can combat longer EMV processing times Adapting point of sale systems to accommodate new cardholder experience Facilitates the introduction of new payment technologies e.g. NFC, Contactless, m-commerce.
  • 16. THE EMV FOOD CHAINMerchant Acceptor Vendor Supplier Invest in EMV technology Integrate certified EMV upgrades hardware and/or software technology Comprehend what EMV / Integrate technology to best PCI obligations it has as a practices merchant Manage relationships with Look to establish working EMV equipment suppliers & groups EMV payment processors Training of staff STAKEHOLDERSCard Acquirer / Issuer Payment Processor Gateway Confirm Liability Assist Merchants and Acquirers Parameters Facilitate merchant transactions Upgrade & Maintain Be an interface provider Systems to support between merchants’ systems’ manage EMV data and the acquirer / issuer Stay EMV & PCI compliant
  • 17. STRATEGIES FOR PARKING AUTHORITIESCONSIDERATIONS / PLANNING / IMPLEMENTATION STRATEGIES Develop a EMV technology upgrade and staff training roadmap Consider & analyse the cost of upgrading parking meters, pay stations, entry & exit barriers Research and Invest in EMV certified terminal hardware and software technology Analysing traffic flow and determining the best location to pilot EMV before a complete rollout Understand traffic flow to maximise use of EMV in most traffic congested areas Plan to implement “contactless” for improved efficiency of payment Monitor best locations for EMV to minimize time spent searching for payment Understand the liability shift and impact on processing fees, charge-backs and fines
  • 18. CONTACT Stuart McGregor Business Development Manager Stuart.McGregor@paymentexpress.com @ Linkedin @ Twitter www.paymentexpress.com