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EMV: What does it mean for Issuers?

The EMV ball is starting to roll in the U.S., and the EMV specifications will affect all actors in the existing payment scheme – from issuers, acquirers, merchants to consumers. For issuers, this transition to cards that can perform EMV transactions can be segmented into three parts: enhancements to the back-office systems, enhancements to authorization systems and customer service.

Part of the beauty of EMV cards is their ability to run multiple applications as well as their dynamic nature in which the card’s behavior can be changed while in the field.  Much of the onus of this beauty, however, falls on the issuers. Back-office systems must now expand to handle new personalization requirements, application life-cycle management, parameter management and CRM. They also need to change their fraud monitoring and key, PIN and risk management solutions.

From an authorization system standpoint, issuers need to consider authentication and cryptography management. Data elements and script management become more complicated with EMV as cards can be blocked (or unblocked) and behaviors changed while the card is in the field. PIN changes also bring new complexity with online and offline PIN changes needing to be synchronized between the card and the host.

An often forgotten about area – customer service – needs to be addressed as well. With a more complex card payment product comes more complex service scenarios, which can range from an issue with the chip, problems with the applications on the chip and variable PIN settings, to name a few. Additionally multiple customer service points need to be trained not only on how to diagnose and fix the problem but also on how to access the information associated with the card.

While the transition to EMV will be complex and costly for issuers, there is a business payoff on top of the fraud deterrence advantages. With its multi-application flexibility, EMV products promise great potential for competitive differentiation. As contactless and mobile payments take root, innovations on the payment front will be the cornerstone of satisfying the usability and convenience expectations of today’s increasingly on-the-go customers.


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