ATMs must get ready as more EMV cards get shipped
ATMs are changing in the U.S., thanks to the advent of the EMV smart chip. Serving as the eventual replacement to the magnetic strip, the smart chips on credit and debit cards are becoming the new way to pay. With security measures in place to thwart thieves and hackers, these cards provide a measure of safety for consumers. Banks and merchants are being pushed to upgrade with the October 2015 liability deadline less than 6 months away. Upgrading ATMs to accept these cards will become necessary in the long term.
ATMs need to accept growing number of EMV cards
The most recent news regarding chip cards shows a surge in their shipment. ATM Marketplace, citing figures from the Smart Payment Association, noted that 2.1 billion credit and debit cards with embedded chips were shipped around the world in 2014. That is more than double the amount shipped in 2011. The reason for the surge can be directed to two countries: the U.S. and China, the latter of which has its own smart chip standard. The U.S. has been slow to pick up these cards, but a series of data breaches at national retailers have pushed customer sentiment in favor of adding the chips to their cards.
There have also been developments in other areas related to smart cards, based on the same report. Contactless technology, which has previously been considered a novelty development dating back to the early 2000s, is on the rise again. Of the chip cards that shipped around the world last year, 42 percent could be used in a contactless manner. This was higher than the 37 percent shipped in 2013. Another important measure was dynamic data authentication technology, which is a new scheme for EMV cards that protects them against cloning. In 2014, 70 percent of all chip cards shipped had this technology, a 4 percent increase from the year before.
With EMV chips becoming a prominent and necessary component of new debit and credit cards in the U.S., merchants and banks have to move to make changes to their ATMs so that they're ready for the coming technology shift. For merchants in particular, they have to face the possibility of taking responsibility for any and all fraudulent charges from credit and debit cards if they don't switch to using EMV. Getting an ATM with EMV and switching the cash may only be a viable solution if the cost of upgrading is too much.
May 22, 2015