Issue link: https://read.dmtmag.com/i/107993
The New EMV Credit Cards Reducing fraud with technology By Jean Feingold This article was adapted from an article originally published in PMAA Journal, published by Innovative Publishing and the Petroleum Marketers Association of America. A new credit card system available in Europe for several years is gradually being rolled out in the U.S. Called EMV, short for EuroPay, MasterCard, and Visa, Europe's major credit card associations, each card contains a secure microchip. Some cards require customers to key in a Personal Identification Number (PIN) for purchase authorization. While Visa wants to continue using signatures as the main cardholder verification method in the U.S. at least for now, some major banks prefer PINs, said Peter Forbes of WorldPay US, a PMAA National Partner and Endorsed Vendor. Currently fewer than 20 major U.S. banks are issuing the new cards and only to select customers, but these banks provide about 80 percent of all credit cards in the U.S. As these banks replace expiring existing cards with chipenabled cards, increased adoption of chip technology by smaller banks is likely. The new cards will be hybrids with both magnetic stripes and chips. At some future date, the card associations may require chip only cards. New card readers required To accept these new cards, c-store operators will need new card readers at each cash register and gas pump. Since it will take time for all card issuers to migrate to EMV, the new card readers will support both magnetic stripe and chip data entry methods, explained Forbes. Because c-stores have multiple points of sale, both inside and at the pump, it will cost c-store operators substantially more to upgrade to EMV than other retail or restaurant businesses. 32 OIL PROPHETS WINTER 2013 Readers with PIN pads suitable for use at cash registers cost from $200 to $900 depending on desired features. "For pay-at-the-pump, we're seeing indications that many manufacturers are charging roughly $1,000 per fueling position," Forbes said. Many major hardware vendors will help station owners offset upgrade costs through creative funding solutions like offering paid advertising through the pump's screen. Installation of the new readers can be fairly simple. PIN pads attached to a countertop terminal or integrated cash register system will be cabled the same as existing units so the old PIN pad can be unplugged and the new one plugged into the same outlet. Chip ready, pay-at-the-pump card readers will have the same chassis and form factor as existing readers. "Because c-stores have multiple points of sale, both inside and at the pump, it will cost c-store operators substantially more to upgrade to EMV than other retail or restaurant businesses." The benefit to merchants "EMV cards reduce fraud in part thanks to including a dynamic value with every transaction," explained Forbes. "Unlike magnetic stripe cards, which can be cloned, EMV cards send a different value on every transaction to let the card's issuer identify it as a valid card." Adding PIN authentication helps combat card loss and fraud even more.