The ABCs of EMV

Solving The Problem Of Payment Card Fraud

This is the first in a 3-part series about EMV technology and how it helps keep sensitive data away from cyber-thieves.

Payment card fraud is a fast-growing problem that negatively affects the bottom lines of merchants and card issuers around the world.

In 2013, merchants and issuers lost $14 billion worldwide to payment card fraud, a 19 percent increase over the previous year.[i] But those numbers tell only part of the story. Payment card fraud in the United States grew 29 percent in 2013, compared with 11 percent in the rest of the world,[ii] and although the United States accounts for only a quarter of the world’s payment card transactions, more than half of all fraudulent card transactions happen here.[iii]

Why has the United States become the world’s leader in fraudulent card transactions? One reason is that the United States is the only major consumer market in the world not to have adopted the more secure EMV™ payment card standard. That is beginning to change. The global brands are now encouraging US retailers to begin accepting EMV payments, and some of the largest US merchants have already begun doing so.

Still, many merchants have been slow to invest in the point-of-sale (PoS) system upgrades needed to accept EMV payments, especially when so few customers carry EMV cards today. However that is changing. Industry watchers estimate that by 2015, there will be over 270 million EMV credit and debit cards in circulation in the US, and half of all U.S. retail locations will be able to accept EMV cards. [iv] Questions that are uppermost in everyone’s minds: Will consumers embrace and use their EMV payment cards, and how much will EMV transactions reduce payment card fraud? The answer lies in how the EMV technology works.

Payment card fraud is one of the fastest growing problems negatively impacting merchants and card issuers around the world.

Check out the infographic to learn more about the essential role EMV plays in the reduction of payment card fraud.

Infographic: The ABC's of EMV

[i] Heggestuen, John, “The US Sees More Money Lost to Credit Card Fraud Than the Rest of the World Combined,” Business Insider (March 5, 2014).

[ii] Ibid.

[iii] Ibid.

[iv] “EMV IN USA: Assessment of Merchant and Card Issuer Readiness,” Javelin Strategy & Research (April 2014).

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