EMV technology to be required by the end of 2015

Last week, this blog covered the fact that "Chip-and-PIN" technology was a focal point of the Senate Judiciary Committee. Executives from both Target and Neiman Marcus said they have plans to use the technology to improve their security systems already in the works, but will be speeding up the process.

While this may be the idea of these two retailers, the entire industry is also going to need to get on board whether they want to or not. A recent article from the Wall Street Journal features an interview with Carolyn Balfany, MasterCard's expert on all things EMV technology.

First it is important to know that both MasterCard and Visa have already released a roadmap that organizations need to follow in order to meet an October 2015 deadline. That is when a "liability shift" will take place.

According to Miller, after the deadline, when fraud happens the liability will shift to whichever party has the lesser technology. This means that if a merchant is running an old system, they can still run swipe and signature payments, but they will also be liable for any fraudulent transactions if the customer has a chip card. If the retailer has updated technology and the card does not have the chip, the bank is liable in the case of fraud.

"The key point of a liability shift is not actually to shift liability around the market," Balfany said. "It's to create co-ordination in the market, so you have issuers and merchants investing in the migration at the same time. This way, we're not shifting fraud around within the system; we're driving fraud out of the system."

With the help of a payment solution provider, any organization will be able to get ahead of the EMV changes.

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