The following blog post is from EPCOR member Katie Lutman, Fifth Third Bank. Katie will be part of a panel discussion, EMV- Stakeholder Perspectives on the US Adoption, at EPCOR Payments Conference - Spring 2015. Make plans now to attend this year's conference and hear from industry experts on a variety of payments topics.
As anticipated, issuers and merchants alike are feeling the
impact of the slow adoption of chip card technology in the U.S.
Fraudsters are following the path of least resistance, as evidenced by 2014’s
spike in U.S. merchant compromises, including big-box retailers like Home
Depot. According to initial estimates from the Identity Theft Resource
Center, more than 64 million credit and debit card accounts were impacted in
2014 as a result of over 100 compromises* – and those are just the known
compromises.
The upcoming Visa® and MasterCard® rule changes for fraud
loss liability is having a major impact on the card industry in the U.S.
In order for the chip technology to truly be effective, both merchants and
banks must deploy the technology.
One without the other will do little to
thwart fraudsters when it comes to counterfeit fraud schemes. Issuers are
working to rapidly replace existing cards in hand, and acquirers are supporting
merchants’ efforts to upgrade point-of-sale
terminals.
Both require significant investment in time and money, but the
alternative of doing nothing could result in customer attrition and fraud
losses that could exceed costs related to deployment.