Visa announces EMV-focused program
Visa has noticed a growing trend towards consumer safety radiating from increased EMV card used. As a result, it has announced a new plan to further EMV distribution by making it easier for merchants to adopt EMV-enabled point-of-sale machines.
The new initiative, sponsored by the Visa Technology Innovation Program, is aimed at furthering PCI compliance by reducing its initial requirements. Visa typically requires merchants to annually validate their compliance to PCI standards if 75 percent or more of their transactions are performed using EMV chip-based cards. In this new program, Cisco is removing the annual validation prerequisite to ease EMV adoption.
Under the new rule, merchants need an EMV-enabled point-of-sale device capable of handling both contact and contactless payments or just contact payments to obtain Visa's services. Any merchant, outside of the United States, that can handle both dual and contact-only types of payment could be eligible for the program starting on March 31, 2011.
Other restrictions on which merchants can join the program have to do with PCI compliance. While the annual validation has been removed for all merchants, except those that mostly handle ecommerce or MO/TO payments, companies still have to have previously passed an official PCI audit. Clients accepted for the program also need to maintain their PCI compliance standards while they use Visa's services.
"Visa has repeatedly underscored the need for authentication solutions to move to dynamic data technologies such as EMV chip. Although Visa's global fraud rate remains at an all-time low of less than 6 pennies out of every $100 transacted, we believe the future of security lies in dynamic data. Our experience suggests that as markets move to chip they become less vulnerable to counterfeit fraud and, ultimately, to mass data compromise attacks," said Ellen Richey, chief enterprise risk officer at Visa.
Jim McCarthy, global head of products at Visa, said the new plan could improve PCI compliance throughout the industry because EMV smart cards have proven themselves a valuable and secure payment solution. Its ability to handle dynamic data transactions will allow for significant payments innovation, he said.
Visa's plan is not available in the U.S. because it has been slow to adopt EMV technology. Recently, the Smart Card Alliance released a whitepaper detailing what the U.S. payment card industry can do to replace magnetic strip cards with more advanced smart card technology.