By J.D. Oder II, CTO and senior vice president of R&D, Shift4 Corporation
October marks the liability shift date, when the four major credit card brands, Visa, MasterCard, Discover, and American Express, will begin shifting the financial liability for credit and debit card fraud to organizations that do not support EMV chip cards. According to EMVCo’s most recently published data, in 2014, the U.S. had reached an EMV adoption rate of only 7.3 percent. Although marketing efforts to promote EMV adoption in the U.S. would have merchants and others believe that this figure would substantially rise by the liability shift date, it is looking unlikely. Based on Forrester estimates, widespread EMV chip adoption in the U.S. won’t take place until 2020.
The scope and uniqueness of the U.S. payment space makes the pending migration to EMV particularly complex. Various industry trade groups have contested different aspects of the U.S. EMV liability shift, such as that most U.S. card issuers are offering EMV cards with signature verification instead of PIN verification, which is the standard in Europe. Others have asked for the liability shift date to be extended. Also, processors are in need of more staff to process certifications fast enough to keep up with demand. And, as it turns out, EMV alone won’t solve all of today’s security problems, namely the data breaches that merchants have been plagued with in recent years.
Lack Of Clarity Clouds EMV
Some influential EMV supporters have created a sense of panic surrounding the adoption of EMV, generating confusion among merchants by suggesting that EMV would have protected merchants like Home Depot and Target from large-scale data breaches. As the EMV liability shift date gets closer — which at this time is not a mandate — other organizations in the payment space are pressuring merchants to quickly adopt EMV. This is leading some merchants to rush into the quickest EMV solution possible, not necessarily the best one for their businesses.
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