Jack Henry & Associates announce new EMV-chip cards

Jack Henry & Associates recently announced that its Payment Processing Solutions division will begin to offer chip-and-signature cards to its Visa-branded Europay, MasterCard and Visa credit union customers. According to the company, these cards have garnered wide acceptance outside of the United States.

The cards contain an embedded microchip that bolsters fraud protection, which is crucial for cardholders who travel frequently, as well as a magnetic stripe so they can be used in the United States.

"These cardholders will benefit from reduced card-present fraud as well as greater convenience and merchant acceptance," the company said in a press release. "The EMV standard was created to define the functional requirements for both chip card and chip-reading terminals. These standards help ensure global interoperability and enhanced security."

According to Jack Henry & Associates, the new EMV card will not only position itself to support overseas travelers more effectively, but also enhanced security, which the company expects to become a new standard in the U.S. market. Also, many high-profile retailers are in favor of microchip and magnetic stripe cards, including Best Buy, the Home Depot and Walmart.

"Frequent overseas travelers represent an important membership segment for many credit unions," said John Postle, general manager of Payment Processing Solutions for Jack Henry & Associates. "There are only a few institutions in the nation currently issuing microchip cards, and we believe PPS is ahead of the curve and well-positioned to take advantage of the growing demand for this technology."

Although the United States has been hesitant to adopt EMV cards, a study by GLG Research points to the technology being implemented in the near future. According to payments expert David Cole, many U.S. companies have not supported EMV because they view it as an unnecessary step in the evolution of payments, as well as too expensive. Despite these reservations, there are developments in place that will bring the technology to the country sooner rather than later.

"Fraud is rising, although in a credit card market this can be ignored to some extent as it was in many of the early migrating markets, until the governments there got involved," said Cole.

Other trends leading to the eventual adoption of EMV payments are worldwide interoperability and refusal of magnetic stripes in migrated markets, which, according to Cole, is the No. 1 reason the technology will reach the United States.