Page 44 - GS170402

Education

Semi-integrated solutions I think of all the innovations we are

delaying – faster payments, integrated
accelerate your EMV transition loyalty programs, data analytics,
transportation logistics – I really worry
about losing our competitiveness, with
By Naga Jagadeesh IT focused mostly on EMV."
ThoughtFocus It is easy to lose perspective on EMV's
anti-fraud value when its implementa-
n "Your EMV transition: It gets better," The Green Sheet, Feb. 13, 2017, tion hampers your ability to embark on
issue 17:02:01, my colleague Bob Olson and I described how technology empowering IT initiatives. But fraud is
frameworks can make your EMV implementation easier, faster, safer huge, and it exacts an enormous price
I and cheaper. That's great, but let's face it: you're not in business to be from merchants today. According to
the cheapest or the fastest. You're in business to compete, sell, prosper, delight The Nilson Report:
your customers, and so on, while also being secure and compliant. (Not exactly
parenthetically, that's what the entire country needs – growing companies • U.S. gross fraud losses by issu-
offering good jobs, better products and steady innovation.) ers, merchants, and acquirers in
2015: $8.45 billion.
Yet here we are in 2017, with many of the best information technology (IT) • Spending at merchants using
people consumed by the complexities of EMV (Europay, Mastercard and Visa) global general purchase cards in
compliance. Whether you are a merchant, a merchant services provider, ISO or 2015: $20.423 trillion.
independent software vendor, many of the IT resources you need to innovate
and enable your ambitious growth goals are focused on EMV. • Credit, debit, and prepaid cards
in circulation worldwide in 2015:
Fraud prevention versus innovation 18.08 billion.
As one executive of a large, rapidly growing, consumer-focused company put it, The enormity of those statistics under-
"Look, we want the anti-fraud benefits of EMV as much as anybody. But when scores two things: the heavy liability
of exposure for all parties involved
and therefore the importance of ac-
celerating EMV implementation. And
at this stage of EMV implementation,
when things are still rocky and faulty,
it's easy for things to go wrong, creat-
ing liability exposure. It would be un-
wise for companies to delay EMV com-
pliance.
The liability threat

Needless to say, merchants and other
companies are anxious to find ways
to limit their liability. One way is to
limit their exposure to information
they do not need to complete a trans-
action – such as the cardholder's pri-
mary account number, PIN, CVV, full
track data from the magnetic stripe or
EMV chip data. With EMV, all of that
can be delegated straight to the semi-
integrated module (pre-certified for a
processor) where it can remain unseen
and untouched and securely transmit-
ted to the processor.
Currently, merchants are exposed to
that data in multiple ways when they
perform full integrations or repro-
gramming. Once exposed, they incur
enormous obligations and liability
they neither need nor want.

44