Nine out of 10 Americans use chip cards at about a third of U.S. locations enabled to accept chip payments. In its winter 2017 market snapshot, the Princeton Junction, N.J.-based U.S. Payments Forum, formerly the EMV Migration Forum, provided updates on EMV chip migration status.
When it comes to EMV chip migration the forum also revealed steady progress in the U.S. with an estimated 79% of ATMs completing migration by the end of 2017.
“The volume of chip-on-chip transactions has been growing at a steady rate, but we need to accelerate merchant enablement to reach critical mass and meet the goal of the chip migration: removing in-store counterfeit card fraud, the largest source of fraud in the U.S., from the system,” Randy Vanderhoof, director of the U.S. Payments Forum said. “To help the industry meet this goal, the Forum is prioritizing outreach and educational programs for the ATM, petroleum, transit and hospitality industries, as well as the mid-size merchant community.”
In addition to aiding the chip migration, to reduce in-store counterfeit card fraud, the U.S. Payments Forum prioritized the importance of addressing fraud in the card-not-present environment in online and mobile channels. “It is absolutely critical that the payments industry continue to simultaneously devote the same level of energy to work to avoid fraud increasing in the card-not-present channel,” Vanderhoof added. “
The forum also addressed recent deadline modifications. At the end of last year, American Express, Discover, Mastercard and Visa altered timelines for their respective EMV fraud liability shift policies for automated fuel dispensers in the U.S.− originally slated to take effect in October 2017− to October 2020.
The delay comes because of unique challenges facing the retail petroleum industry in upgrading their outside pay-at-the-pump systems to EMV. The U.S. Payments Forum explained there were some misconceptions caused by the petroleum industry to delayed migration plans. But the petroleum industry understands they need to ‘put the pedal to the metal’ and use this extra time to complete the hardware and software upgrades at the pump to make sure their outdoor environments are enabled to accept chip as quickly as possible to avoid fraud risk.
In its announcement, Mastercard said, “EMV compliance for fuel merchants with Automatic Fuel Dispensers brings significant regulatory and implementation challenges. Over the past months, we have had extensive discussions with fuel merchants, issuers, acquirers and other stakeholders regarding these unique challenges.”
In its statement, Visa acknowledged, “The fuel segment has its own unique challenges, which we recognized when we first set the chip activation date for automated fuel dispensers/pumps two years after regular in-store locations. We knew that the AFD segment would need more time to upgrade to chip because of the complicated infrastructure and specialized technology required for fuel pumps.”
In its December 2016 statement, Visa also acknowledged there has been great progress with EMV migration in the U.S. More than 1.7 million merchants representing more than a third of storefronts now accept chip cards; with 388 million Visa chip cards issued. “We are already seeing a 43% reduction of counterfeit fraud at chip-enabled merchants.”
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