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Reducing fraud and frustration with EMV

By: Amy MacMullen, Director of Card Services

Amy MacmullenJanuary 29, 2015 -- For credit unions, the biggest benefit of EMV (Europay, MasterCard, Visa ) chip cards is their powerful fraud prevention technology. Because every EMV card is essentially a small, secure computer, EMV cards are nearly impossible to counterfeit. By replacing the current unencrypted magnetic stripe on credit and debit cards with an embedded chip, smartcard technology adds dynamic data to the transaction process, making it far less vulnerable to fraudsters.

Reducing card fraud with EMV

We now recognize that the adoption of EMV in other parts of the world has significantly reduced card fraud in those regions. Unfortunately, the migration of fraud from EMV-enabled countries to the United States is clearly already underway. Between 2009 and 2013, the percentage of global payment system compromises centered on the U.S. rocketed from 38% to 67%.* Currently, credit union card issuers absorb $430 million in fraud losses split between $206 million in card-present (CP) and $224 million in card-not-present (CNP) transactions.* Based on other countries’ EMV experiences, EMV deployment will cut those fraud losses by 40% to 60%, which will generate up to $248 million credit unions could return to their members through lower loan rates or higher dividends.*

Reducing frustration, appealing to more members

The number of merchant locations overseas where consumers can use magnetic stripe cards is diminishing, which is a source of frustration for many travelers who carry magnetic stripe cards. EMV cards appeal to high value members who travel internationally, along with military personnel and international students.

Unlocking new transaction experiences for consumers

Lastly, it is not far-fetched to assume that today’s EMV cardholder could become a credit union’s next mobile-payments channel adopter. EMV and NFC (Near Field Communications) are two game-changing technologies that put a tremendous amount of transactional power in the hands of consumers and merchants. EMV’s chip technology is a foundational building block for future mobile payments methods and will potentially unlock a multitude of new transaction experiences for consumers.

Contact me today to learn about moving your credit union over to EMV technology. Corporate One’s Cards Solutions is primed and prepared to begin moving credit to EMV today.

Amy MacMullen
Director of Card Services
amacmullen@corporateone.coop or 614/825-9339

*Source: PSCU

 

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