The US has reached record level growth in EMV, the Europay created Europay, MasterCard, Visa, according to ABI Research. The forecast for 2016 is an astounding 617 million units of newly issued smart chip cards. Phil Sealy, Senior Analyst at ABI Research states, “EMV migration in the U.S. ramped up quickly, with market penetration likely to hit close to 100% over the next two year.”
To gain a closer look at the activity in the US, Jason Oxman, CEO of the Electronic Transactions Association, gave the San Diego byteclay.com an updated report on the EMV integration. His research shows Visa reports that nearly 70% of Americans now have at least one chip card in their wallets and a recent MasterCard study found that about 50% of big merchants report some level of chip activity. MasterCard also found that 611,000 small merchants have activated EMV terminals.
The growing concern for merchants is the card-not-present fraud attempts which according to Oxman increased 33 percent in 2015 over 2014 attempted card fraud. “The pattern we’re witnessing is an increased frequency in fraud, but perpetrated at lower dollar amounts, decreasing by an average of $9 from $282 in 2014 to $273 in 2015.”
Criminals are watching the EMV implementation by merchants and this leaves open those who have not upgraded to an EMV terminal for their business, and the outlook for online fraud is higher as the shift is made to EMV. Oxman states that, “Counterfeit card fraud in the U.S. is projected to fall more than 50 percent to $1.77 billion between 2015 and 2018 while card-not-present fraud will jump $3.3 billion (+106 percent) to $6.4 billion.”
Oxman warns of another cyber security risk on the rise on 2016. He accessed his reports to note that Software security provider McAfee reported over four million instances of ransomware activity during 2015’s second quarter and they expect to see an increase throughout 2016.
Ransomware allows hackers to steal and encrypt sensitive personal or company data and then demand a ransom be paid by the victim in order to reacquire their decrypted information. It is a costly game to stay ahead of the criminals who gain access to vulnerable information through holes in web browsers, but software companies are continually innovating. Oxman states, “Keeping your software up to date along with steadfast monitoring are the best ways to thwart these insidious attacks.”
The expense of reissuance of a credit card is another factor in the entry of EMV cards. This expense requires a disaster plan according to Payments Source. Diversification for processing their cards and a security conscious plan is the number one item to be listed. Education is vital and most consumers have disregarded the EMV information or have not received sufficient information from their bank or credit union.
The Electronic Transactions Association will hold its annual conference, TRANSACT 16, April 19-21, 2016, at Mandalay Bay Convention Center in Las Vegas. More than 4,000 industry executives from across the global payments and technology industries, the buyers of your products and services will be on the TRANSACT 16 trade show floor looking for new business opportunities!