The liability shift around EMV implementation is quickly approaching. Have you considered how EMV will impact your systems, processes and customer service as a whole? From issuers to acquirers, merchants and consumers what is your strategy for deployment? What should you expect?
What issuers should expect
For issuers, this transition to a card system that supports EMV transactions can be divided into three parts: enhancements to the card and dispute management systems, enhancements to authorization systems and customer service.
Part of the appeal of EMV cards is their ability to run multiple applications as well as their dynamic nature in which the cards profile can be changed while in the field. Much of the onus of this beauty however falls to the issuers. Back office systems must be expanded to handle new personalization requirements, application life-cycle management, parameter management and CRM all must be adjusted. Issuers will also need to change their fraud monitoring PIN and risk management solutions. From an authorization system standpoint, issuers should consider authentication and cryptography management. Data elements and script management become more complicated with EMV as cards can be blocked, or unblocked, while the cards are in the field. PIN changes also create a new complexity with online and offline PIN changes needing to be synchronized between the card and the host.
Customer service requirements should also be addressed. A more complex card payment product will result in more complex service scenarios. These can range from an issue with the chip to problems with the applications on the chip or variable PIN settings to name a few. Additionally, your organizations’ associates need to be trained to not only diagnose and fix the problem, but also how to access the information associated with the card. This is the type of change which may result in customer confusion and possible resistance. A clearly defined educational program which spells out the consumer advantages of EMV is called for. Just as customers were sold on debit cards, ATM’s and internet banking, they should be sold on EMV.
The transition to EMV will be challenging in a number of ways, yet there is a distinct business reward for issuers in addition to fraud deterrence. With its multi-application flexibility, EMV promises great potential for competitive differentiation. As contactless and mobile payments take root, innovations on the payment front will be the center piece of satisfying the usability and convenience expectations of today’s increasingly mobile customer.
What does it mean for acquirers?
The transition to EMV presents challenges for acquirers as well. There will be significant infrastructure changes for acquirers on par with that for the issuers. To prepare for this, issuers should think about breaking down the implementation project into three parts: device enhancements, enhancements to acquirer systems and customer service.
While the task may seem daunting, the complexity of the EMV implementation can be lessened somewhat by installing EMV capable devices which can be upgrade at a future date. In some cases, a software upgrade can be used to bring a device to full EMV compliance.
In terms of systems enhancements, acquirers need to update transaction processing systems to handle additional data processing elements and EMV scripts as well as update switch interfaces. The storage of transaction certificates, or EMV e-receipts which prove the transaction took place, need to be automated and have the ability to send changes in case of a charge dispute. Also, acquirers need to think through how these infrastructure changes impact the customer service outlet. Merchant education and training, support, consumer training via the merchant must be conducted in advance to be ready to deal with the various process changes. dispute
What else should you consider?
EMV preparation and implementation will be complicated. However, with a sound strategy it will be an investment of time and resources that, once completed, will reap ample rewards. The key to ultimate success is to partner the business, operations and IT groups within the organization so that the EMV implementation addresses both the technical aspects of the project as well as the functional, business and customer needs. With an understanding of what needs to be done, a clear and collaborative environment will make a successful implementation of EMV much more likely than a siloed approach. Lastly, keep in mind that financial institutions and merchants in the U.K., Canada and other countries have successfully implemented EMV so you are not journeying into unknown territory.
Andy Brown is the director of product marketing at ACI Worldwide.