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A basic FAQ for EMV.

Beginning in October 2015, that liability shifted to the merchants in certain cases unless they have replaced or upgraded their card acceptance and processing systems to use chip-enabled devices and applications to process payment transactions. 

1. What is EMV?

EMV stands for EuroPay, MasterCard®, Visa®, the three entities that worked together to create worldwide standards for the chip card to ensure global interoperability. EMV is a payment method that combines a plastic card with integrated circuit chip (ICC). An EMV card uses the ICC to hold the account number and other sensitive data instead of using a magnetic stripe. The chip also contains logic for transaction processing and risk management. EMV adoption in the rest of the world has been a gradual process that has taken years to decades to penetrate. The U.S. will need to modify many of its payment process to fit into the EMV model. EMV Chip cards generate a one-time code with every transaction making it nearly impossible for counterfeiters to duplicate them and use them for in-store fraud.   A great source of information on EMV, including historic information and recent announcements is the EMVCo™ website, 

2. What are the features of the Chip?  

The chip stores information, performs processing, contains secure elements which store secret information and performs cryptographic functions.

3. Why EMV?

Chip cards help prevent in-store fraud and are nearly impossible to counterfeit.  U.S. card present fraud is above the world average and continues to increase. EMV supports enhanced verification methods such as PIN and Signature verification. In October 2015 there was a fraud chargeback liability shift for merchants that choose not to implement EMV. In addition, starting in 2015 U.S. issuers began to issue more cards that have EMV chips on them.

4. What changes with EMV for a merchant?

A.    Many different parts of the payment process changes when moving from a magnetic stripe transaction to an EMV transaction:

1.    The process flow of a transaction changes due to the use of dynamic authentication of the card.

2.    To achieve the dynamic authentication, an EMV capable terminal is required with an EMV reader.  Merchants may also support contactless transaction devices when updating to the EMV reader.

3.    In order to complete the transaction, the card will have to stay in contact with the chip reader throughout the entire transaction.

4. With the addition of dynamic authentication, there are new message requirements including Data Element that carries the EMV information. 

5. Can customers with magnetic stripe cards use EMV terminals?

Yes, the EMV terminals certified by Vantiv will also have a magnetic stripe card reader.

6. Can an EMV card be used in a magnetic stripe terminal?

Yes, for the foreseeable future credit and debit cards will be issued with a chip on the front of the card and the familiar magnetic stripe on the back of the card so that chip cards can be backwards compatible with existing non-EMV capable devices.

7. Do EMV transactions take longer to process than magnetic stripe transactions?

EMV transaction times are highly dependent on how the issuer has personalized the card and how the merchant configures the terminal.

If the card or the terminal has not been configured in an efficient manner, transaction times can increase significantly (several seconds). If the card and terminal are properly “tuned” the actual transaction time will increase by only a few seconds.  However, the overall time in lane will increase due to the additional interaction the cardholder has with the transaction.

8. When do I need to be EMV compliant?

While there is no specific mandate from the card brands to be EMV compliant, merchants need to be EMV certified (or using pre-certified devices) by October of 2015 in order to avoid any impact from the counterfeit fraud liability shift.

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