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Yet card fraud defies simple fixes. "As crucial as they
are, we should keep in mind that prevention tools
[like EMV] cannot stand alone. Even with stronger
authentication methods, robust network security and
other approaches in place, preventative measures aren't
sufficient," Powell said.
In his remarks, Powell echoed a sentiment that I have
heard expressed with increased frequency: a need
exists for more and better cooperation between and
among players in the payments space to combat fraud.
"Complacency is everyone's enemy," Powell added.
"Unfortunately, the firms involved in the payment
system are not the only ones innovating: criminals have
an ever-increasing arsenal of cyber-weapons at their
disposal."
The Fed can't do much about that on its own. Fraud
fighting is not part of its charter. However, it is in charge
of setting policies and providing services to banks that
promote an efficient payment system. And security
certainly contributes to efficiency in payments.
Powell said the Fed hopes its latest payment system
improvements project can be a catalyst for change. (See
"Fed looks to online real-time payments, eventually,"
The Green Sheet, March 23, 2015, issue 15:03:02) As part of
that project the Fed has set up two industry task forces,
one focused on faster payments, the other on payment
security. Each task force is expected to help the Fed
come up with plans for improving payments, which the
central bank then can encourage the industry to follow.
Seriously, that's how it works; the Fed's role is pretty
much limited to jawboning.
In the meantime card issuers need to speed up migration
to chip cards, and improve customer education, experts
agree. "Neglecting cardholder education on EMV is a
squandered opportunity for banks to shine," said Nick
Holland, Head of Payments at Javelin. "The halo effect
from EMV will not last long – only a few short years
– because of the normalization process of EMV in the
public domain. For FIs to capture consumer attention,
they need to proactively educate across a variety of
media."
For many consumers, the only education provided is
printed materials delivered with new cards, Holland
added. Which brings me to my final point: chip card
issuance continues to lag. I carry two credit cards and
two debit cards in my wallet. Yet not one has been
replaced with a chip card, and the EMV compliance
deadline is less than four months away.
Patti Murphy is Senior Editor of The Green Sheet and President of
ProScribes Inc. She is also the founder of InsideMicrofinance.com.
Email her at patti@greensheet.com.
28
Yet card fraud defies simple fixes. "As crucial as they
are, we should keep in mind that prevention tools
[like EMV] cannot stand alone. Even with stronger
authentication methods, robust network security and
other approaches in place, preventative measures aren't
sufficient," Powell said.
In his remarks, Powell echoed a sentiment that I have
heard expressed with increased frequency: a need
exists for more and better cooperation between and
among players in the payments space to combat fraud.
"Complacency is everyone's enemy," Powell added.
"Unfortunately, the firms involved in the payment
system are not the only ones innovating: criminals have
an ever-increasing arsenal of cyber-weapons at their
disposal."
The Fed can't do much about that on its own. Fraud
fighting is not part of its charter. However, it is in charge
of setting policies and providing services to banks that
promote an efficient payment system. And security
certainly contributes to efficiency in payments.
Powell said the Fed hopes its latest payment system
improvements project can be a catalyst for change. (See
"Fed looks to online real-time payments, eventually,"
The Green Sheet, March 23, 2015, issue 15:03:02) As part of
that project the Fed has set up two industry task forces,
one focused on faster payments, the other on payment
security. Each task force is expected to help the Fed
come up with plans for improving payments, which the
central bank then can encourage the industry to follow.
Seriously, that's how it works; the Fed's role is pretty
much limited to jawboning.
In the meantime card issuers need to speed up migration
to chip cards, and improve customer education, experts
agree. "Neglecting cardholder education on EMV is a
squandered opportunity for banks to shine," said Nick
Holland, Head of Payments at Javelin. "The halo effect
from EMV will not last long – only a few short years
– because of the normalization process of EMV in the
public domain. For FIs to capture consumer attention,
they need to proactively educate across a variety of
media."
For many consumers, the only education provided is
printed materials delivered with new cards, Holland
added. Which brings me to my final point: chip card
issuance continues to lag. I carry two credit cards and
two debit cards in my wallet. Yet not one has been
replaced with a chip card, and the EMV compliance
deadline is less than four months away.
Patti Murphy is Senior Editor of The Green Sheet and President of
ProScribes Inc. She is also the founder of InsideMicrofinance.com.
Email her at patti@greensheet.com.
28
