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What Does EMV Mean for eCommerce?

Brendan Miller

The implementation of EMV protocol for secure credit and debit card processing in the U.S. is already underway.  Banks and card issuers have begun putting chip cards in the hands of their cardholders, and with the liability for fraudulent card present transactions shifting to merchants in October 2015, EMV is gaining momentum.  

While EMV chip cards look just like standard magnetic stripe cards, they contain a microprocessor, or chip, that enables every transaction they initiate to carry a unique cryptogram. That cryptogram is validated by the issuer, and it’s difficult for criminals to break it and steal card information or to create counterfeit cards. Additionally, to complete an EMV transaction, the cardholder must be present to enter a PIN number or a signature.  

It’s clear that much of the added security that EMV provides is dependent upon the shopper having physical possession of the card. In ecommerce, that’s not a possibility. This is where fraud prevention tools and other security measures become even more important. Here are some to consider:

  • Tokenization removes sensitive cardholder information from merchants’ systems by substituting a credit, debit, prepaid or checking account number with a string of numbers known as a token. Each token is specific to that business and useless to anyone else who might try to use it.
  • End-to end (E2E) data encryption can mask full credit card data while it’s in transmission from checkout to the authorization network and back.  E2E masks the full credit card number with meaningless characters so the real card data is never visible.
  • Advanced fraud detection techniques including Device Fingerprinting, IP Proxy Piercing, and IP Geolocation can help provide more decision points for accepting or declining card payments based on past suspicious activity. 

EMV has long been in place in other parts of the world and has significantly reduced card present fraud in those regions.  However, research shows that the decline in card present fraud was often accompanied by a substantial uptick in card not present fraud.1 What will this look like in the U.S.? Only time will tell. In the meantime, make sure you’re using all of the security tools at your disposal to provide the best protection for your ecommerce customers. 

For more information about how EMV affects ecommerce, contact Vantiv Integrated Payments .

1  Federal Reserve Bank of Atlanta, https://www.frbatlanta.org/documents/rprf/rprf_pubs/120111_wp.pdf, 2012. 

 

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