Major banks upgrading ATMs to accept EMV chips
Banks are pushing ahead with the transition to the EMV chip standard through ATMs. Given that cash withdrawals are a key factor in the overall success of a consumer-based financial institution, these machines will serve as the forefront of the consumer transition from magnetic stripe to chip-based transactions. When more machines are able to read the cards, banks will feel more comfortable distributing the cards to consumers, who in turn will encourage the banks to upgrade their machines. This cyclical process, while confusing at times, guarantees the end goal of transitioning the American public to use the more secure cards for everyday matters including payments, deposits and other services.
Leading bank upgrades ATMs, cards to EMV
There are more than 18,000 ATMs owned by Chase Bank, making it one of the most prolific banks in the country in terms of customer reach. In order for the EMV transition to be a success, this large swath of machines needs upgrading to read the new cards. That includes software upgrades and changing the card reader so that a consumer can simply dip his or her card to read the chip.
According to ATM Marketplace, Chase is doing precisely that. It has announced plans to upgrade its ATM infrastructure so that it can accept the EMV chip standard. On top of this upgrade, the company is simultaneously moving its customers to the chip cards, having previously been the first bank in the U.S. to do so. Over the course of the next 12 months, it will increase its number of EMV debit and credit cards, as well as its Liquid prepaid debit cards, from the current amount of 22 million to reach near-full saturation. By the end of 2015, the bank expects 70 percent of its customer base to have switched from magnetic stripe to chip through mail distribution.
A key issue in the transition process remains education. Chase conducted a study with consumers about card security and safety. While 80 percent of consumers surveyed were concerned about the state of debit and credit card security, 65 percent had never heard of EMV or related chip card technology. Of those who had, 76 percent thought that it would help prevent fraud. Banks will need to step up explaining the technology to customers, and ATMs that work with the chip will help make that process much smoother by demonstrating the relatively new technology. A better-informed public will use and demand ATMs with the technology installed.
July 23, 2015