EMV: It's About Reducing Fraud

Silicon Valley Bank Plans to Expand Chip Card Program

The combined global effect of the identity theft fraudsters that swindled at least $9 million from 8,000 victims in a period of 15 years (Atlanta, GA) and a 16 month period ID theft crime costing over $13 million across Africa, Asia, Europe, the Middle-East, and the United States (Queens, NY) may cause those opposing the Europay, MasterCard, Visa (EMV) standard to rethink their stance on the chip and PIN card technology. According to Pradeep Moudgal, who oversees global cards and merchant services for Silicon Valley Bank (SVB) in California, chip and PIN card technology migration by U.S. financial institutions will be expensive. However, considering the cost already inflicted on the accountholders and the issuing banks, what more evidence is needed to convince the U.S. card issuers to support EMV and implement chip and PIN. No one knows.  

The vast majority of ID theft crimes are attributed to the magnetic stripes on the back of the cards, says Avivah Litan, a Gartner analyst. This Achilles heel of the global card industry could finally be eliminated with the implementation of chip and PIN card technology. As the first U.S. commercial bank to implement EMV, SVB is proving that fact as it rolled out EMV cards with its elite business cardholders. Following that will be SVB’s more affluent clienteles who travel overseas.

The embarrassment of card rejection overseas and increased global ID security vulnerability, in the long run, far outweigh the cost of chip and PIN card technology implementation. Moreover, the reduction of ID theft fraud, as evidenced in the U.K. and some parts of Europe and Asia, should be a strong motivating factor to those in the U.S. still gauging the cost and benefits of the new technology. If chip and PIN could become a positive tool to mitigate cybercrime, financial fraud, identity theft, information security threats, etc., why not give it a shot. Any takers?

Reference:

http://www.bankinfosecurity.com/p_print.php?t=a&id=4187