1. Banks and EMV
Monday, March 11
Moderator: Rakesh Mirajkar, Capital One
Panelist: Richard Parry. JPM Chase
Stephanie Ericksen, Visa
Mario Blanchette. RBC
3. An EMV CHIP is like a computer embedded in your
card, which has the ability to process data and
information
• The term “Chip and PIN” is a misnomer: PIN is not
always required by EMV or Chip cards
– Online PIN: encrypted by PIN pad and sent online to
the issuer host for validation. ATMs typically require
online PIN
– Offline PIN: sent directly to chip card for validation by
chip – PIN never sent to host, only result is sent
– Signature only: Card prompts terminal to print receipt
or capture signature
• Chip protects from counterfeit fraud by introducing
dynamic values that change with each transaction
EMV CHIP
• PIN protects from lost and stolen by verifying
Unlike mag stripes, EMV cards store correct cardholder is using the card
card information on the microchip
embedded in the card
4. Visa, MasterCard, Discover & Amex have
announced EMV conversion timelines
Milestones Key Dates Visa MasterCard Discover American Express
PCI annual validation relief for Oct 2012 Y Y Tba N
qualifying merchants Oct 2013 Y
PCI account data compromise relief
75%-50% Oct 2013 N Y Tba N
95%-100% Oct 2015 N Y tba N
Acquired / Sub – processor chip April 2013 Y Y Y Y
data mandate
Counterfeit Liability Shift Oct 2015 Y Y Tba Y
(excl fuel dispensers)
ATM counterfeit liability shift Y (October Y Cross border Tba N
2017) Maestro (April
2013), Domestic
(Oct 2016)
Lost or stolen Liability shift Oct 2015 N Y Tba N
Counterfeit liability shift for Oct 2017 Y Y Tba Y
automated fuel dispensers
Lost and Stolen Liability shift for Oct 2017 N Y Tba
automated fuel dispensers
Source: Smart Card Alliance Payment Council Analysis
5. Counterfeit fraud has gone down dramatcially in
regions that have implemented EMV
UK Counterfeit Fraud
180 169.8
160.4
160 148.5
144.3
140 129.7
120 110.6
£ millions
96.8 98.6
100
80.9
80
60 47.6
36.1
40
20
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Source: Financial Fraud Action UK 2012 report
6. Various dimensions of EMV discussion
Customer Implementation Operational
Risks post EMV
Experience challenges issues
• Fraud migration • Customer education • Implementation • EMV business case
• Magnetic stripe • Merchant role setbacks • Data
fallback • Customer complaints • New process
