One of the major developments in ATMs the last few years has little to do with the machines themselves. The EMV smart chip began appearing on debit and credit cards over the last several months as part of a push by MasterCard and Visa to replace the magnetic stripe as the mechanism of payment. While recent cyberattacks targeting retailers such as Target heightened awareness of the technology, it's only this year that the concept took center stage. That's because, on Oct. 1, 2015, most retailers that didn't have EMV readers installed at point-of-sale became liable for any on-site card fraud. Still, despite this massive push toward EMV-based cards, not many consumers actually know about them. ATMs may have to take a role as educator to help in the ongoing transition.
One of the major obstacles in the move to EMV is customers actually wielding cards with the chip. While most banks now issue EMV debit cards, penetration remains an issue. In most cases, people only get these new cards when replacing an expired debit card or changing how they bank. Because banks take on a passive role in the transition process, many customers may not even know they have the new technology in their wallets.
A survey by Javelin Research found a problem with the lack of education on the EMV standard as well. Talking with more than 8,500 retail bank customers, the firm revealed 47 percent said they only found out about the chip through printed material that came in the mail. It was not only the most common but also the least effective method of marketing, since it only came as the card was forced upon them.
By not taking an active role in educating their customers, banks lose an opportunity to make a strong impression on them. The study indicated that EMV cardholders held a better view of their financial institutions than non-EMV cardholders because they know of this information. One possible channel for educating customers on the chip and its benefits is using ATMs as advertisers and educators. By advertising the new cards on placards attached to the machine, banks can pique consumer interest by directing them to other channels for more information. A more direct approach can also occur during a transaction. While the machine processes a person's information and requests, it can display screens discussing the chip, further driving people to learn more.
December 1, 2015