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This is David Grindel; I'm with ACI, Director of Solutions Consulting for our Canadian office. I've been with ACI for over 15 years in the payments business. The reason I'm your speaker today is that as the Canadian market moved to EMV over the last 6 or 8 years, I spent a great deal of time in learning the specifications, working with other regions around the world where ACI customers have moved to EMV, and then supported a lot of our Canadian customers into moving into this solution. Now that the US has begun the same move, been acting as a bit of a support role to ACI in helping our US customers move that direction, as well.
I will cover off, roughly these 3 central topics. I will not be going into details on EMV itself. ACI did a webinar late last year on EMV, and if you refer to the ACI EMV webpage, I'll be able to see a recording of that webinar in which I go over some of the basics of what the EMV protocol actually is.
Today, I'll be focusing more about where the US stood before the Visa/MasterCard announcements. I'll discuss in some detail those announcements, and its effect on the market. Then be moving into what's probably most interest, which is what does this mean to you as acquirers?
Acquirers today, we're targeting both retailers themselves, as well as processors that are doing merchant acquiring. We have many of those on the line. I will for a brief period talk about the solutions that are in the marketplace to help you address EMV. Then finally, we have some tips on what to do to attack the EMV project and how to get started.
Starting off with EMV in the United States: There's been years leading up to the Visa/MasterCard announcements, there was to some extent a great deal of confusion. Some major merchants had announced that they were moving to EMV, although not many; predominantly one large merchant. More than anything else, there was a great deal of confusion about how card payments would evolve. The whole PCI issue was huge, in terms of a both cost and management attention in retail and merchant processing, and then a wide variety of technical solutions to address PCI requirements bubbled up through the marketplace, and in encryption, tokenization, one-time use cards; there were a wide variety. Retailers and merchant processors were to some extent at a loss about where to invest their money. When you reterminalize your entire point-of-sale fleet, it's not only a significant dollars expense; it's also a multi-year commitment. It's almost a generational, although I hesitate to use that word, but it's a 5 or a 6-year commitment when you reterminalize your base.
Then while that was confusing from the security end, there was also an evolution of payments, in terms of payment innovation. Card schemes and some issuers beginning to promote things like NFC and mobile payments. As a retailer, you don't want to be left behind. You want to have these acceptance devices available. It would be nice if there were some credible mass payment card there. Then you also had 2D barcodes, key fobs, and contactless tap-and-go that was non-NFC, with Paypass and Payway. As a merchant or as a processor, there was a lot of confusion about what direction to go and what standards to support. The unfortunate outcome of that confusion was inertia, a lack of change.
On the issuer side, just as you are probably aware speaking mostly to an acquire crowd. The issuers were having the same problems as their international travelers were starting to get declined overseas. Travelers in Europe today are expected to have a chip card, and clerks looked quite suspiciously at non-chip and at unattended devices. If you are buying transit tickets, train tickets, parking, you simply cannot transact without a chip card. Finally, those conditions led a number of issuers to begin announcing EMV cards, but they were almost exclusively just for international travel. These were not for . . . with one or two significant exceptions, these were not for domestic use. SUBSCRIBE HERE TO SEE MORE GREAT VIDEOS
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