As an employee of an EMV Company I was interested to read that Wal-Mart’s demanding Chip and PIN! Wal-Mart, the giant US retailer, is calling for the introduction of EMV technology in the United States, to allow credit card payments to be performed using a processing chip on the card instead of using the card’s magnetic stripe.
An increasing problem in recent years has been the cloning of bank cards, whereby the magnetic stripe of a bank card is covertly read and is then used to create cloned cards that can be used to fraudulently obtain goods and cash even if the genuine card is still in the cardholder’s possession. However, the advantage of using Chip and PIN cards is that the EMV specifications enable both the cardholder and the card to be authenticated, and so any attempt to clone the data on the chip card will fail.
Globally, many markets have already made the decision to migrate to the EMV industry standard, including Europe, Asia and, importantly, the USA’s closest neighbours Canada and Mexico. The problem is that because not all markets have migrated to EMV, this means that EMV cards still need to contain a magnetic stripe to allow them to be used abroad by business travellers and tourists – international acceptance of credit cards being one of the key advantages that Global brands such as Visa and MasterCard have promoted. This means that, as EMV migration gathers pace around the World, countries such as the USA that can only process magnetic stripe transactions risk increasingly becoming the target for fraudsters, who always seek to exploit the weakest points in the industry.
Internationally, Wal-Mart are themselves no strangers to EMV – for example their ASDA stores in Britain have accepted Chip and PIN cards for years – and they are therefore in a good position to understand the issues involved with EMV migration in the USA. If a company the size of Wal-Mart is beginning to push for this, there is hope that the card industry and retailers in the United States will take notice, and realise that the business case for rolling out EMV cards and terminals is becoming increasingly compelling.