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Scheme and EMV Compliance Changes for Unattended Cardholder Activated Terminals

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EMV is the international industry standards that define the rules for processing chip cards, originally named after the 3 organizations’ (Europay, MasterCard and Visa) that produced the …

EMV is the international industry standards that define the rules for processing chip cards, originally named after the 3 organizations’ (Europay, MasterCard and Visa) that produced the specifications. The EMV standards require all merchant unattended terminals to be EMV complaint and be able to process Chip EMV transactions in the correct unattended format to their Bank. Replacing card-not-present (CNP) payment processing at unattended locations.

(Australian) EMV compliance mandates all card readers for real time payments at merchant unattended terminals need to be upgraded and EMV complaint by the 1st April 2013 deadline. Failure to comply may result in financial penalty, liability shift to the merchant for fraudulent transactions and an increase in merchant fees.

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  • 1. SCHEME AND EMV COMPLIANCE CHANGES FORUnattended Cardholder Activated Terminals Date HereAUSTRALIAMARCH 2013
  • 2. SCHEME AND EMV COMPLIANCE CHANGESWHAT IS EMV? EMV is defined by EMVCo as, “a global standard for credit and debit payment cards based on chip card technology”. The key element of EMV chip card technology involves including dynamic digital data in every transaction. This makes these types of transactions extremely secure and reduces the risk of fraud over traditional magnetic stripe payment cards. The EMV standards and associated compliance processes are managed by EMVCo
  • 3. SCHEME AND EMV COMPLIANCE CHANGESWHY EMV?The EMV Specifications were developed to: Improve payment security • This is achieved by Offline Data Authentication/Offline PIN Verification between card and terminal and online Card Authentication between card and Issuer Achieve globally interoperability • Realised through EMVCo type-approved terminals, readers and ATMs Create a payment infrastructure that would support emerging technologies • For example, standardising technology infrastructure for contactless payment and contactless mobile payment.
  • 4. SCHEME AND EMV COMPLIANCE CHANGESEMV VS. MAGNETIC STRIPE TRANSACTIONS? Magnetic stripe transactions, exchange only the cards track 2 data containing the card number and validity dates, where as every chip card transaction contain multiple pieces of information exchanged between the card, the terminal and the acquiring banks host This requires the terminal to perform many stages of complex processing, including cryptographic authentication, to successfully complete a transaction EMV replaces the card-not-present (CNP) payment processing at unattended locations providing security and reduces the risk of fraud
  • 5. SCHEME AND EMV COMPLIANCE CHANGESWHAT ARE THE LEVELS OF COMPLIANCE?EMV payment terminal approval consists of three levels: EMV Level 1 covers the electrical and physical interfaces, and the transmission of data, between the terminal and the card. All chip card reading terminals must pass the EMV Level 1 test before use with EMV cards EMV Level 2 covers the set of functions that provide all the necessary processing logic and data that is required to select and process a card application in order to perform an EMV transaction EMV Level 3 covers the “end to end” merchant acquirer and scheme approval (i.e acquiring banks) and the card schemes (Visa, MasterCard)
  • 6. SCHEME AND EMV COMPLIANCE CHANGESWHAT’S THE IMPACT ON EXISTING INFRASTRUCTURE These EMV specifications require all merchant unattended terminals to be EMV complaint and be able to process Chip EMV transactions in the correct unattended format to their Bank by the scheme deadlines • Replacing card-not-present (CNP) payment processing at unattended locations Unattended payment terminals – are also known as; • Unattended Cardholder Activated Terminals’ (UCATs) • Cardholder Activated Terminals’ (CATs) • Unattended Payment Terminal (UPT) • Unattended Acceptance Terminal (UAT)
  • 7. SCHEME AND EMV COMPLIANCE CHANGES AUSTRALIAN EMV COMPLIANCE DATES Visa requires that all terminals need to be EMV capable by 1st January 2014Visa requires that allnew installed Visa requires that allterminals need to be terminals need to beEMV capable from contactless EMV capablethe 1st April 2012 by 1st April 2014 Visa … on going 2012 2013 2014 2015MasterCard requires MasterCard requires MasterCard requires that MasterCard … on goingthat all new installed that all terminals need all terminals need to beterminals need to be to be EMV capable by contactless EMV capableEMV capable from the 1st April 2013 by 1st April 20141st April 2012 MasterCard shifts liability to the merchant for non EMV compliant transactions
  • 8. SCHEME AND EMV COMPLIANCE CHANGESWHAT CHANGES ARE NEEDED? EMV compliance requires that, all credit card payment terminals, also known as; (UCATs), (CATs), (UPT) AND (UAT) need to be upgraded to EMV compliant hardware For unattended payment terminals, this typically means that the existing magnetic stripe card reader will need to be replaced by an EMV chip card capable alternative An upgrade to the EMV standard enables safer, smarter and more secure transactions across cards, contactless, mobile, and remote payment channels. It also enables merchants to offer consumers the next generation of digital payment innovations
  • 9. SCHEME AND EMV COMPLIANCE CHANGESEXAMPLE EMV COMPLAINT DEVICES BY DPS | PAYMENT EXPRESSSCR200 DEVICE (OPTIONAL PIN AND CONTACTLESS MODULES)
  • 10. SCHEME AND EMV COMPLIANCE CHANGESEXAMPLE EMV COMPLAINT DEVICES BY DPS | PAYMENT EXPRESSSCR200VM DEVICE FOR VENDING
  • 11. SCHEME AND EMV COMPLIANCE CHANGESEXAMPLE EMV COMPLAINT DEVICES BY DPS | PAYMENT EXPRESSINGENICO I9530 AND I9550 CHIP AND PIN DEVICE
  • 12. SCHEME AND EMV COMPLIANCE CHANGESDEVICES THAT ARE NOT EMV COMPLAINTBoth card schemes and acquiring banks will determine the consequences where transactionscontinue to be processed over a non EMV complaint solution. MasterCard compliance mandatesall card readers for real time payments at merchant unattended terminals need to be upgradedand EMV complaint by the 1st April 2013 (Australian deadline for processing via the EMVformat)Failure to comply may result in shift of liability to the merchant and an increase in merchant service fees financial penaltiesSee http://www.mastercard.com.au/media-releases/03292011.html
  • 13. SCHEME AND EMV COMPLIANCE CHANGESFOR FURTHER INFORMATION CONTACTTo understand how the compliance requirements and changes apply to you.Contact your; Equipment vendor Acquiring bank DPS | payment express • provider of EMV compliant terminal devices and card processing gateway
  • 14. CONTACT DPS | PAYMENT EXPRESS For further information regarding DPS | payment express services, please contact; Stuart McGregor Business Development Manager (Sydney, Australia) Stuart.McGregor@paymentexpress.com Phone: +612 8268 7700 www.paymentexpress.com