EMV Archives - ID TECH Products https://idtechproducts.com/tag/emv/ Tue, 23 Jul 2024 15:36:56 +0000 en-US hourly 1 https://wordpress.org/?v=6.7.2 https://idtechproducts.com/wp-content/uploads/2024/03/cropped-IDT-Favicon-32x32.png EMV Archives - ID TECH Products https://idtechproducts.com/tag/emv/ 32 32 TRUSTECH 2022 – What a Difference a Year Makes! https://idtechproducts.com/trustech-2022-what-a-difference-a-year-makes-2/ Thu, 29 Dec 2022 23:45:59 +0000 https://idtechproducts.com/?p=4776 After having missed TRUSTECH in 2021, ID TECH couldn’t pass up on the opportunity to exhibit at and attend one of the biggest shows in Europe. So we gathered our Team, packed our bags and headed to Paris, France, for TRUSTECH 2022, excited to share all of the new things going on at ID TECH in front of a global audience.

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After having missed TRUSTECH in 2021, ID TECH couldn’t pass up on the opportunity to exhibit at and attend one of the biggest shows in Europe. So we gathered our Team, packed our bags and headed to Paris, France, for TRUSTECH 2022, excited to share all of the new things going on at ID TECH in front of a global audience.

6,500+ Attendees at TRUSTECH 2022

TRUSTECH is known as THE global event showcasing the latest hardware and technologies dedicated to innovative payments and identification solutions. This was the 38th edition of the show and this year the event took place at Paris Expo Porte de Versailles where, for 3 days, people from all over the world in various business sectors such as tech, smart card, innovative payments, in addition to financial and governmental institutions, crowded the aisles and exhibition floors. According to the official 2022 TRUSTECH Facts & Figures article, this year’s show boasted 150 exhibitors (85% from outside of France) and over 6,500 attendees (an increase of 30% compared to 2021). TRUSTECH Director, Anne Frayssinet, said this of the show: “TRUSTECH 2022 was a great success from every point of view. Many business meetings, scheduled upstream, took place during the fair, which highlighted how dynamic this industry is in terms of projects and commercial potential. A high-level program was brought to our attendees…many innovations showcased in the booths!”

ID TECH Booth with NEO 3 Product & Demos

ID TECH was proud to be a part of those “many innovations” that were showcased at the show. Notably, this was ID TECH EMEA’s (Europe, Middle East & Africa) biggest exhibitor booth to date, featuring our latest innovative technology, the NEO 3 Platform of Products. We also displayed several integrated solution demos ranging from an EV charging station equipped with our VP6825, to a parking meter utilizing the VP7200’s ability to drive an external display.  These demos, coupled with working units of our new NEO 3 Platform of Products as well as our products currently in the market, like the VP3300, showcased all that ID TECH has to offer. We gave each booth visitor a unique, hands-on experience with our newest products and left them with ideas on how our hardware can meet a variety of business needs and provide complete market solutions.

Visitors in the ID TECH Booth

Our entire NEO 3 Platform of Products was very popular amongst all booth visitors. The AP6800, our Android-compatible device, received a lot of attention as visitors were impressed with its look, size, and display resolution. Hearing feedback from booth visitors such as, “Nothing else on the market that competes with the size”, referring to the compact Kiosk V and VP7200 contactless readers, and, “The universal connection (USB-C) makes our work (integration) so much easier and is more appealing to us and our clients” tells us that not only are our NEO 3 products desired, but are needed in the payments industry today!

Fernando Herkenhoff Speaking at the Innovation Stage

Adding to the excitement and buzz surrounding the NEO 3 Platform of Products, our very own Fernando Herkenhoff, Director of Sales (EMEA), took center stage as an expert presenter on the TRUSTECH Innovation Stage. Fernando talked about how ID TECH is accelerating payments in the unattended markets and how we are tackling challenges in the unattended space. “ID TECH is built for unattended…it’s one of our expertise,” said Fernando during his presentation. To watch Fernando’s entire presentation CLICK HERE.

In our mission to expand and discover new ways to become a full-service, payment solutions provider, ID TECH has developed and launced a software service that will enable users to manage their entire estate of ID TECH devices anytime, anywhere. Software Services was also featured in our booth with a working demo showcasing different features such as remote firmware updates and numerous remote content management tools. Interest was high as the demo was used regularly throughout the course of the show and feedback was very positive when visitors experienced our demonstration of Software Services. We are very excited to offer this software component to our products and services in 2023.

Sales Managers Chris Harrow & Didem Birdamla Speaking to Booth Visitors

Interacting with our peers and customers, it was obvious that there is a growing excitement in the payments industry and it is very encouraging! In speaking of this year’s show, Lance Ning, VP of Marketing, said this: “It was great to be back in Paris for TRUSTECH this year to showcase our latest products in front of a truly global audience.  It’s always a pleasure to connect with our customers from around the world.  TRUSTECH does a wonderful job of connecting the payments and identification industries, and ID TECH is looking forward to being back to exhibit again next year!” What a difference a year makes!

About ID TECH

ID TECH is a global leader in payment peripherals, with sales, manufacturing, and R&D facilities worldwide. The company has become a well-established payment solutions provider with extensive experience in data capturing and encryption products and services. Designing dependable, feature-rich products has made ID TECH a leading supplier of MagStripe readers/writers, mobile payment readers, contactless readers, smart card readers, barcode readers, POS keyboards, signature capture devices, PCI-compliant PIN pads, and other specialty products for OEMs, VARs, resellers, distributors, and key end-users. ID TECH provides both standard and custom solutions to support customer requirements.

For more information, visit www.idtechproducts.com.

 

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ETA: The New and the Renewal https://idtechproducts.com/eta-the-new-and-the-renewal/ https://idtechproducts.com/eta-the-new-and-the-renewal/#respond Thu, 12 May 2022 19:56:38 +0000 https://idtechproducts.com/?p=3372 After a two-year hiatus filled with cancellations and virtual shows, ID TECH is happy to see in-person tradeshows have made a roaring comeback in 2022.

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After a two-year hiatus filled with cancellations and virtual shows, ID TECH is happy to see in-person tradeshows have made a roaring comeback in 2022. With new team members, new products, and a new dedication to innovation, ID TECH has evolved since the start of the pandemic, and we were eager to show our customers and partners how far we’ve come.    

As a worldwide leading tradeshow association for the payment industry, the Electronic Transactions Association (ETA) has a reach of over 30 countries and 500 payment-related companies. ID TECH has been a member of ETA for years and, with its considerable influence on the payment industry, we knew it was a show at which we wanted to have a strong presence.

A New ID TECH

In the months leading up to ETA, ID TECH worked hard to prepare a tradeshow booth that would show our partners and customers all the updates we had made since the beginning of the pandemic.  

We created a brand new booth and updated our branding to complement our product launch of the brand new NEO 3 platform of products.  

NEO 3 

Starting in the fall of 2022, ID TECH is releasing our NEO 3 platform of products. The NEO 3 products are a series of versatile, ruggedly designed products that can be seamlessly integrated into multiple industries and environments.  

“NEO 3 is a state-of-the-art payment platform,” explains George Jiang, Chief Technology Officer. “Many hardware manufacturers didn’t invest in their products over the past few years. But ID TECH has been working on providing value to our partners and customers through this innovative product line. Plus, they look cool!”  

Our sleekly designed NEO 3 products were displayed at ETA along with fully customized, operational demo units to show our products integrated in multiple unattended payments environments, and all ETA attendees were the first to get a sneak peek.  

ID TECH at ETA

Like previous exhibit years, ETA was large, loud, and a little overwhelming, which all contributed to the excitement the ID TECH team felt while attending the show. 

Our newer and older staff members bonded over drinking, eating, and experiencing ETA from beginning to end. Other exhibitors attracted attendees to the booths with gourmet coffee setups and novelties like customized air-brushed clothing. ETA itself offered a broad selection of food, snacks, and drinks for everyone. The ETA staff was amazingly accommodating and made sure to include some “play” along with other typical tradeshow activities such as seminars and networking events.  

“My favorite part of ETA was having face-to-face, real-time interactions with partners and customers,” says Ginger Wu, Senior Product Manager. “Experiencing and seeing their reactions and instant feedback to ID TECH’s newest solutions and services was priceless.” 

Overall, ETA was the perfect event for our company to allow attendees to interact with ID TECH’s newest payment technologies and meet some of the people who created them. 

The Future

ID TECH plans to continue growing our presence at ETA and other tradeshows. The feedback we got from staff and attendees was extremely positive and a big encouragement towards our forward momentum.   

As we evolve our company, products, and brand to match the changing landscapes of different customer needs and emerging technologies, we’re happy to see that the events we attend and the customers we meet are receptive to “The New ID TECH” that is forming.  

“ETA was my first tradeshow with ID TECH and I couldn’t have picked a better one to start with,” says Ryan Maulit, Marketing Manager. “Everything we experienced was so positive. It made me really proud to be a part of ID TECH.” 

Thank you to everyone we met at ETA, partners and customers alike, and thank you to our amazing staff members who came together and made ETA a momentous experience for ID TECH as a company. 

For more information about the other events ID TECH will be attending, click here.  

For more information on ID TECH’s NEO 3 platform of products, please visit our NEO 3 webpage.   

About ID TECH

ID TECH is a global leader in payment peripherals, with sales, manufacturing, and R&D facilities worldwide. The company has become a well-established payment solutions provider with extensive experience in data capturing and encryption products and services. Designing dependable, feature-rich products has made ID TECH a leading supplier of MagStripe readers/writers, mobile payment readers, contactless readers, smart card readers, barcode readers, POS keyboards, signature capture devices, PCI-compliant PIN pads, and other specialty products for OEMs, VARs, resellers, distributors, and key end-users. ID TECH provides both standard and custom solutions to support customer requirements.   

For more information, visit www.idtechproducts.com

 

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Loyalty Trends in the Vending Industry https://idtechproducts.com/loyalty-and-vending/ https://idtechproducts.com/loyalty-and-vending/#respond Fri, 25 Sep 2020 21:55:39 +0000 https://idtechproducts.com/?p=1756 As part of our latest blog series, we’re taking a look at loyalty solutions in various industries to see what companies are doing to enhance customer retention and user experience. It’s no surprise that large retailers and brands have long used loyalty programs to entice and reward their top customers. In recent years, retail companies are also beginning to adopt loyalty solutions for vending machines as the preferences of their customers evolve. Here are some popular loyalty solutions in the vending industry right now:

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As part of our latest blog series, we’re taking a look at loyalty solutions in various industries to see what companies are doing to enhance customer retention and user experience. It’s no surprise that large retailers and brands have long used loyalty programs to entice and reward their top customers. In recent years, retail companies are also beginning to adopt loyalty solutions for vending machines as the preferences of their customers evolve. Here are some popular loyalty solutions in the vending industry right now:

Vending Machine Apps

Unlike brick-and-mortar merchants or eCommerce retailers, unattended vending machines do not have the luxury of leveraging a sales staff to get customers to sign up for loyalty cards at checkout or online. As a result, many vending loyalty programs have been integrated into mobile apps to ensure that a tailored customer experience is still created. This provides a perk for customers, who can keep better track of their rewards and see them when they are most relevant. Loyalty program applications enable machine operators to reward their frequent customers, increase sales through additional purchases, and win new accounts.

Points for Using Mobile Wallet

Many vending companies are implementing a loyalty initiative where customers can receive points for using their mobile wallet. The idea is that consumers get points or credit for using their mobile wallet at various vending machines. Once a customer racks up enough points, they get a free vending machine product.

Prepaid Card Incentives

Offering a discount to customers with prepaid cards – such as employee ID cards or gym membership tags – can be an effective incentive to push patrons toward choosing their prepaid card as their preferred payment method. The motivation to purchase from the vending machine, as opposed to going to a nearby physical store,  also needs to be acknowledged with the price differences in addition to convenience. Many vending machines are starting to offer different prices for various payment methods, and then advertising the multiple prices for one item to highlight the discount.

Reward Customers with Membership

Another great way to extend relationships with customers through a loyalty program is the idea of introducing membership levels. The machine can recognize  frequent customers and reward them based on their membership type. From there, the customer can receive special discounts or free credit.

The ID TECH Solution

ID TECH’s commitment to providing innovative and quality solutions for your digital loyalty program comes through in our vending line of products. Our newest one is the VP6800, which uses NFC technology to support contactless payments as well as loyalty and rewards features. It is a sleek, single piece solution certified with the latest contactless brand specifications and mobile wallet technologies. By supporting all the major card brands, along with Apple Pay, Google Pay, and Samsung Pay, every transaction is covered no matter what you tap!

In addition to contactless reading, the VP6800 also supports EMV chip as well as MagStripe card reading. With a wide temperature range, the rugged VP6800  is ideal for all environments. To learn more about the VP6800, click here.

About ID TECH

ID TECH has established a solid reputation in the industry as a leading payment peripheral provider with magnetic stripe, EMV contact, and EMV contactless expertise. We are also an OEM payment solution provider with the capability and willingness to customize solutions to fit our customers’ needs. With a strong foundation and continued success rooted in card readers, ID TECH is currently expanding its reach in the ever-evolving payments industry.

To learn more about ID TECH, please visit our about page.

 

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Latin America Transit Adopts EMV Contactless Payments Amid COVID-19 Pandemic https://idtechproducts.com/latin-america-emv-payments/ https://idtechproducts.com/latin-america-emv-payments/#respond Wed, 29 Jul 2020 20:35:59 +0000 https://idtechproducts.com/?p=1588 Contactless payment methods have gradually increased in popularity across the world, but COVID-19 has propelled many countries and industries to quickly adopt new technology into their payment solutions. As the novel coronavirus becomes more prevalent, we are seeing a growing desire for limited contact with cash and payment devices to prevent spread of the disease. As a result, the demand for contactless payments has increased in all industries. Retail has begun to evolve by offering NFC payments and self-service checkout kiosks to promote customer safety, and now the transportation industry has begun to advance as well.

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Contactless payment methods have gradually increased in popularity across the world, but COVID-19 has propelled many countries and industries to quickly adopt new technology into their payment solutions. As the novel coronavirus becomes more prevalent, we are seeing a growing desire for limited contact with cash and payment devices to prevent spread of the disease. As a result, the demand for contactless payments has increased in all industries. Retail has begun to evolve by offering NFC payments and self-service checkout kiosks to promote customer safety, and now the transportation industry has begun to advance as well.

Evolving payment methods are becoming the norm and transit systems are having to adapt to a cashless and contactless society.  Countries across Latin America have decided to include multiple payment options to reduce cash and metro card usage. Now there is a focus on other payment methods such as QR codes and EMV contactless payments using debit and credit cards. While this endeavor is for customer safety, it benefits operators by decreasing costs and commuters by increasing efficiency.

In Peru, cashless transactions have increased to 50% of all their transactions since COVID-19 has begun. The Executive President of the Urban Transport Authority for Lima and Callao began offering transportation subsidies to operators who adopt EMV card readers to match cultural payment changes. Transportation officials are hoping this will result in transactions that are safer for customers and their sensitive information.

Along with Rio de Janeiro and Sao Paulo, the city of Curitiba, Brazil will install new validators that allow commuters to use their own EMV cards for tickets, in addition to the existing NFC metro card payment options.  The ability to pay for fares with credit cards provides added convenience to commuters, eliminates the need to recharge a metro card, and reduces the number of cards that commuters need to handle.

ID TECH is currently working with several Ticket Integrators all over the world to allow EMV to be adopted into Latin America public transportation transactions. Validators are being deployed in several cities and use NFC technologies from ID TECH’s Kiosk IV to fulfill their promise to regulate transportation access through a secure ticketing system. The Kiosk IV is a rugged, contactless NFC reader that accepts both contactless payments and mobile wallets. Validators using the Kiosk IV accept both closed and open loop payments while quickly processing priority information for speedy payment acceptance. The combination of the two enables passengers to have a fully integrated, seamless transit experience.

While these payment updates are necessary for the evolving needs of public health and safety, they are sure to have a positive impact on both commuters and public transportation as well. The world is continuing to adopt new payment methods and Latin America has made huge strides by accepting EMV cards for public transportation.

Learn more about ID TECH products at https://idtechproducts.com/.

 

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EMV Certification Process in 3 Easy Steps https://idtechproducts.com/emv-certification-process-in-3-easy-steps/ https://idtechproducts.com/emv-certification-process-in-3-easy-steps/#respond Thu, 07 Nov 2019 00:00:00 +0000 http://idt2.local/emv-certification-process-in-3-easy-steps/ You may have heard of EMV (Europay, MasterCard and Visa) certification as it pertains to businesses becoming EMV compliant with the necessary equipment to mitigate fraud. But what exactly is EMV certification, and how does the process work? With EMV chip technology becoming the norm, what do you need to know about EMV certification?

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You may have heard of EMV (Europay, MasterCard and Visa) certification as it pertains to businesses becoming EMV compliant with the necessary equipment to mitigate fraud. But what exactly is EMV certification, and how does the process work? With EMV chip technology becoming the norm, what do you need to know about EMV certification?

In this piece, we’ll help you answer those questions. We’ll dive into the 3 levels of certification and explain the EMV certification process by breaking it down into 3 easy steps. Additionally, we’ll explain how our EMV certified common kernel makes the process much simpler.

Levels of EMV Certification

Before we dive into the steps in the EMV certification process, let’s take a look at each of the 3 levels. The EMV certification process can be broken down initially into three levels; Level 1 is Hardware. Level 2 is the software kernel, and Level 3 is the solution. These levels make sense if you think of how a device like an EMV card reader works. It isn’t just hardware. It’s the hardware, plus embedded software, plus support for a set of payment networks.

EMVCo is comprised of several member organizations including Visa, Mastercard, Discover, Amex, JCB and UnionPay. The EMVco organization manages and determines requirements for all three levels. They also designate and authorize test labs to complete testing of payment terminals against the EMV Specifications for levels 1 and 2. EMV certification only then earns level 3 after the equipment issued has passed tests with each of the aforementioned card brands.

EMV Certification Level 1: Hardware

This is straightforward. At Level 1, we’re talking about the physical terminal wherein the payments are tested. These tests make sure the device can meet the physical requirements and lower level electromagnetic and communication protocols required, including operating distance tests. EMV Level 1 testing and certification applies to both contact EMV and contactless EMV.

The hardware supplier is responsible for Level 1 EMV certification.

EMV Certification Level 2: Kernel/Library

Now that we understand EMV certified hardware, we can move on to the next level that is concerned with validating payment functionality that runs on the L1 certified hardware; specifically known as a Software Kernel or Library. The EMV kernel is used to ensure that the L1 hardware is able to properly communicate to the EMV chip card.

For EMV contact, there is one common specification established by EMVco for EMV Level 2 testing.  However, for EMV Contactless, each card brand has their own unique specification for contactless EMV Level 2.  Typically, the payment hardware supplier will also provide a Level 2 EMV kernel and associated L2 certification as the software kernel traditionally runs internally within the payment terminal.

EMV Certification Level 3: Brand Certification

EMV End-to-End certification, also known within the industry as EMV Level 3, consists of hardware that has passed EMV L1 certification, an approved EMV L2 kernel (or kernels for contactless), the payment application, a chosen gateway/processor and approval from the brands.  Here, all of the components that make up an EMV transaction have all been tested and approved by the brands.

3 Easy Steps to EMV Certification

Now that we understand the 3 levels of EMV Certification let’s dive into the process of obtaining it.

1.) Application Development and Pre-certification testing

Once the hardware has been chosen, the solution provider can then begin the development of the payment application to initiate the payment transaction.  Generally, hardware suppliers will provide associated SDKs and documentation for the application developer to create their application to work with the hardware.  This step can involve some initial pretest to validate that the application is functioning as expected.

2.) Enrollment and Preparation

Once the application is ready and the payment processor chosen, the solution provider can initiate the enrollment process.  This includes filling out the appropriate paperwork required by a payment processor, including the EMVCo certification of the target device containing the EMV card reader. This paperwork is often called the “intake forms” also describe the payment environment and limitations of the solution (ex: unattended kiosk with an integrated insert reader but no supported PIN pad would result in no PIN test cases being assigned). Next, the payment processor must complete the enrollment process so that every one of the card brands can test and verify with their test systems. With enrollment done, we move on to preparation.

Preparation involves the payment processor issuing test credentials and host access information which runs a basic transaction in order to authenticate that the account was set up properly. This will prevent IT issues like your firewall blocking access as well as other access restrictions being cleared. Reviewing all test scripts ensures all desired application features are covered during certification.

3. EMVCo certification and validation

To obtain EMV certification, it is suggested to use a UL Brand Test Tool (BTT) to load in test cases from the card brands to be run against the device and application. These can cost around $12,000 to purchase and are a must-have. During this part of testing, a person must sit and manually execute hundreds of tests, meaning inserting a card, pushing buttons and keeping a record of results as part of the “tpp” file designated for the UL Brand Test Tool.

After this level of testing has been completed, the application is done because all issues are considered fixed or covered by a waiver. You are now in the pre-validation stage wherein every test must be carried out with the card brand test systems. Each brand has an individual check following this stage to ensure the host and card passed through the system. This test might take several days to complete.

Validation is the actual and final certification, the home stretch if you will of the entire process. That means a final round of testing, but timed against official card brand certification hosts to work out any kinks or surprises all the prior testing might have missed. For the coup de grace, certifications issued via e-mail to signal your work is done.

How ID TECH Can Streamline The EMV Certification Process

If the entire process sounds too complicated, then ID TECH can make it easy for you. ID TECH’s Common Kernel makes the certification process simpler. Once you have a contact EMV payment solution that contains any ID TECH Common Kernel product and is Level 3 certified, no new Level 3 certification is needed to integrate new products based on ID TECH’s Common Kernel.

This enables flexibility and agility when there is a need to upgrade or add EMV payment solutions to a system. You don’t have to begin the expensive and intensive Level 3 certification process again. When you consider how time-consuming the EMV certification process can be, this is a game-changer. Eliminating recertification can lead to huge gains in productivity and speed up time to market.

Interested In Learning More About EMV Certification? Contact The Experts!

At ID TECH, we not only make the EMV Certification Process simpler and easier on your budget, but we make it easy for you to accept every way your customers want to pay. From kiosks to ATMs to mobile payments, we’ve got you covered with the latest in PCI certified contact and contactless EMV payment technology.

If you would like to learn more about ID TECH regarding the EMV Certification process, a more in-depth exposure to the entire process, how it can maximize profits for your business and mitigate losses due to fraud, contact us to learn more at IDTECH.

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What is an EMV Card Reader? https://idtechproducts.com/what-is-an-emv-card-reader/ https://idtechproducts.com/what-is-an-emv-card-reader/#respond Tue, 25 Sep 2018 00:00:00 +0000 http://idt2.local/what-is-an-emv-card-reader/ EMV Card Readers have revolutionized the payment industry. Come learn what they are and about the impact that they have.

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Development of EMV

EMV® developed and managed by American Express, Discover, JCB, Mastercard, UnionPay, and Visa — is a global standard for credit cards that use computer chips to authenticate (and secure) chip-card transactions.1 EMV chips encrypt bank information making it far more secure than the old magnetic-stripe cards. This is very important because of the ever-increasing amount of credit card fraud. As of October 2015, if a customer uses a fraudulent chip card and the merchant does not have an EMV card reader, that merchant could be liable for the fraud. This is known as “liability shift”. The effect of the liability on merchants has produced a steady growth of chip card transactions. In the case of businesses using Square Stand and Reader, in March of 2015 the number of chip card transactions was only 17% of all transactions. And that was seven months before the change in possible liability was enacted. In five short months that number had grown to 36%. By July of 2016, fully 71% of all card transactions were conducted with chip cards. The conversion to EMV Card Readers happened fast and now it is rarer to swipe your card than it is to ‘insert your chip.’

EMV Card Reader’s Around the World

Picture of Euros and an EMV card.

Is EMV new? Yes and no. If you live or travel to Europe you will know that EMV has been in use for over a decade (it actually began in France in 1992).  In the US, however, it has not been prevalent for nearly as long. The United States is switching to chip cards in an effort to rein in credit card fraud. Even though the United States has a quarter of the world’s credit card transactions, almost half of the world’s credit card fraud happens here. This is because those familiar with magnetic-stripe cards use a technology that is outdated and easy to counterfeit. Since implementing EMV technology, there has been a 70% decrease in credit card fraud in the UK.

The US is finally seeing the benefits of EMV technology. The largest resistance by merchants to it is cost. It is estimated that it will cost between $8 and $12 billion dollars to switch ATMs, registers, vending machines, self-service kiosks, and ticket terminals. That is a lot of money but as long ago as 2013, there was $5.3 billion lost to credit fraud. And that was up 12.5% over the previous year.

More recently (March of 2018), Visa has reported that counterfeit credit card fraud has dropped 75% since September of 2015.5 And in the period from April of 2015 to April of 2016, Mastercard saw a decrease of 54% in counterfeit credit card fraud.

EMV Chip Technology

Chip technology is an evolution in the financial payment system that helps increase security, reduces card-present fraud and enables the use of future value-added applications. Chip-enabled cards are standard bank cards that are embedded with a microcomputer chip. Some of these cards may require a PIN instead of a signature to complete the transaction process.

The EMV technology was created primarily to prevent credit card fraud. EMV cards are smart cards (also called chip cards or IC cards) because they store their data on integrated circuits. In addition, they also have the familiar magnetic-stripe technology to ensure backward compatibility.

There are some variations to the EMV standard. For instance, Visa and MasterCard have also developed standards for using EMV cards that support Card Not Present (or CNP) transactions that can be placed over the telephone and internet. MasterCard has the Chip Authentication Program (CAP) for secure e-commerce which supports a number of modes. Visa has the Dynamic Passcode Authentication (DPA) feature, which is its implementation of CAP using default values that are different.

EMV chip cards can also support Near Field Communication or NFC. This transaction completes when you hold the card near to the reader or tap it without inserting it. This is called a contactless transaction as opposed to a contact transaction inserting the chip card in the slot of an EMV card reader. While most of the world is going the route of dual capability (contact and contactless), in the US most financial institutions are only issuing the contact cards. One reason is that the dual capability cards and the necessary readers are expensive to purchase.

Financial data is more secure on a chip card because it deals with dynamic authentication, that is, the data is constantly changing. This makes it hard to isolate and even if someone intent on fraud could access the data, it is encrypted. Unlike magnetic-stripe cards, every time an EMV card is used for payment, the card chip creates a unique transaction code that cannot be used again. Magnetic-stripe cards only have static data which can be copied with an inexpensive card skimmer device in order to create fraudulent cards.

EMV Card Reader Process

Picture of an EMV Card being exchanged across a table.

So let’s talk more about the EMV card reader and the process by which it is used. With the older magnetic-stripe cards, you would simply swipe the card in a slot. And sometimes, if you did not swipe it just right, the reader would not accept the transaction. With the EMV chip card, you insert the card end with the chip into the EMV card reader usually with the chip facing up.

When an EMV card is inserted in the EMV card reader slot, data flows between the card chip and the issuing financial institution to verify the card’s legitimacy and create the unique transaction data. This process isn’t as quick as a magnetic-stripe swipe, however. Failure to wait until prompted to remove the card can result in a transaction that is refused.

You will be prompted for entry (such as a PIN) and then the reader will prompt you to remove the card. After removing the card, you may still need to sign a receipt. Note that EMV chip cards will still have the magnetic stripe on them in case the merchant has not upgraded to an EMV card reader. And sometimes the merchant has the reader but has not upgraded to EMV for different reasons, such as during a busy holiday or another peak season. One merchant I visited had the slot taped shut with the words “No chip, no salsa”! But with the amount of counterfeit card fraud in the US, merchants are sure to follow the lead of other countries.

The numbers bear that out:

  • 855 million: Estimated number of chip cards issued to U.S. consumers so far, per U.S. Payments Forum estimates
  • 85%: Estimated percentage of all U.S. credit cards issued with chips at the end of July 2017, per CPI Card Group
  • 60%: Percentage of U.S. debit cards issued with chips by the end of July 2017, per CPI Card Group
  • $2-$4: Approximately the cost of issuing a new EMV card, per First Data
  • 15 million: Estimated total number of point-of-sale terminals that have to be upgraded to accept chip cards, per Javelin Research & Strategy
  • $6.75 billion: Estimated cost of replacing the 15 million POS terminals with chip card-compliant machines, per Javelin Research & Strategy
  • 50-52%: Estimated percentage of merchant locations currently ready to process chip card payments, per Visa, U.S. Payments Forum and Strawhecker Group estimates
  • 1.81-2.3 million: Estimated number of U.S. point-of-sale terminals enabled to accept chip card payments, per Mastercard and Visa estimates
    Credit: creditcards.com

The US is playing catch up with the rest of the world, but it is moving fast when it comes to implementing EMV technology. The advantages to doing so are quite clear.

Ready to Embrace EMV? Don’t Waste Time!

 

ID TECH is a world-recognized leader in the design and manufacture of secure payment solutions, ranging from PCI-certified PIN-entry devices, PIN on Glass readers, state-of-the-art contactless/NFC payment devices to EMV and Magstripe readers. For more than 30 years, ID TECH has built a reputation based on technical excellence, innovation, and a commitment to superior customer service. Headquartered in Cypress, California, USA (with additional engineering centers in Fremont, California, Shanghai, China and Taoyuan City, Taiwan), ID TECH is an industry leader in delivering payment solutions across the globe.

For more information about ID TECH, please call 1-800-984-1010 or visit www.idtechproducts.com.

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