By Jeffrey Connors, CEO
November 26, 2013
Paul Gereffi from QSR magazine recently interviewed me for the November SmartChain section about PCI Compliance and Merchant Solutions. The article focuses on the latest in payment processing and PCI Compliance technology and solutions for the quick service and casual dining business. Paul and I focused on EMV and how they will affect merchants.
Here is an excerpt of the interview:
There are many issues regarding the onset of EMV into the U.S. payments infrastructure that have yet to be fully understood, says Jeffrey Connors, chairman and CEO of Intrix Technology. While proponents tout that EMV technology could potentially result in the reduction in counterfeit cards, increased security of online payment transactions with real-time transaction approval, lower charge-back costs, and the possibility of reduced PCI compliance costs, there is an initial cost for those implementing the system.
“Some of these changes give me pause for concern,” Connors says. “Operators are intensely concerned about costs, especially if consumers aren’t demanding it, but two different card systems can’t stay.”
The affected parties each have differing concerns. Consumers are mostly concerned about convenience and only feel the impact of EMV technology when they travel overseas and, sometimes, can’t use their cards unless they have the chip. Merchants chafe at the expense of having to buy new terminals. Technology providers have to build new protocols to support chip technology. Processors want to limit their risk and benefit the most from it, so it’s natural for them to drive the switch aggressively.
“They want to be sure it’s a better system, and so far there’s been a communications gap,” he says. “Some question the timing and sense of urgency. Providers need to do more to communicate the benefits to merchants to increase their trust that this will help them.”
Probably the greatest advantage is that it’s virtually impossible to create a successful counterfeit EMV card. An EMV card’s security credentials are encoded by the card issuer at personalization, stored securely in the EMV card’s chip, and cannot be accessed by unauthorized parties. As a result, the cards help prevent card skimming and card cloning, one of the common ways magnetic stripe cards are compromised and used for fraudulent activity, Connors says.
Further, the liability shift from the processor to the merchant might be what ultimately drives the change. This could result in substantial penalties for fraudulent transactions on non-EMV compliant terminals.
For Intrix, the adoption of EMV chip cards means their processing payment platforms were mandated to have the capability to accept EMV payment transactions earlier in 2013. Their EMV roadmap includes adding support in the Intrix Payment Gateway in order to process the additional data that is included in chip transactions, including the cryptographic message that makes each transaction unique. On the Merchant Services side, Intrix offers EMV-enabled POS terminals, and Intrix is working to make EMV a smooth transition for their acquirers and their merchants. Moving full speed ahead, Intrix embraces the move to EMV as an added measure of security and protection for all in the payments industry.
“Our industry has to win the trust and communications battle with merchants and increase their credibility with customers,” Connors says. “EMV technology is going to be the standard and will be better for everyone in the long run.”
* This excerpt was posted with permission from QSR® magazine.