We commend the Federal Bureau of Investigation (FBI) for their recent Public Service Announcement (PSA) which provides consumers with valuable information about the rollout of EMV Chip Cards in the United States, the ways in which their personal information is being protected and how they can effectively prevent fraud. Consumer education is a critical component of any effort to improve security and this announcement is an important part of the FBI’s ongoing effort to combat fraud and cybersecurity threats.
For decades the payments industry has invested in improving the security and safety of the electronic payments system. Most recently, this has taken the form of the rollout of EMV chip cards, which create a unique one-time code to authenticate debit and credit card transactions. This technology provides a new and effective way to essentially eliminate in-store counterfeit fraud when merchants turn on their chip readers. This has been clearly demonstrated in other countries around the world, where adoption of EMV has led a decline in in-store counterfeit fraud by 60-70%.
However, implementing EMV alone is not a panacea. Securing the payments system requires stopping fraudulent transactions wherever they may happen (in person, online, via mobile device or over the phone). That requires a layered approach to security, including solutions like tokenization, encryption and biometrics.
And, it’s not just about securing transactions. Over the past few years, millions of Americans have seen their card information exposed as a result of merchant data breaches. Preventing breaches means the holders of that data – merchants – need to take basic security precautions like protecting their networks. Unlike the payments industry, which has a legal obligation to abide by security standards, merchants have fought tooth and nail to avoid having even basic rules.
These are all straightforward and effective steps that the payments industry is already taking to protect consumers, using technology that exists today. Unfortunately, instead of helping their members to implement these solutions – according to the Strawhecker group only 27 percent of merchants are ready to accept EMV chip cards and – merchant trade associations are fighting every effort to improve security and make chip cards a reality. In fact, recently the NRF suggested that merchants not invest in chip technology at all. Make no mistake, merchant efforts to hamstring the roll-out of new security technologies are about politics, not consumers or security.