Be careful not to approach an EMV migration in isolation.
Visa’s recent announcement to support EMV explicitly backs another related innovation – namely Near Field Communications (NFC) or ‘contactless’ that will impact all of us in the coming years since Visa is the largest payment network in the U.S. and worldwide.
Visa is encouraging U.S. merchants to support EMV chip technology, including incentives for accepting contactless cards and NFC-phone payments. And any move in general by merchants to EMV terminals will support the rollout of contactless, since many will probably upgrade to contactless at the same time they change their magnetic-stripe terminals. At present, fewer than 3% of American merchants accept contactless cards and these payments do not follow the EMV standard. (‘Visa’s U.S. Migration Plan for EMV…’ NFC Times August 2011).
However, a host of phone manufacturers including HTC, Samsung and RIM have announced NFC-enabled phones this year (and Google officially launched its NFC-based Google Wallet) so American and Canadian consumers will begin changing their behaviors in the near future – waving their phones or ‘mobile wallets’ near POS terminals to purchase railway tickets, movie passes, etc.
Asian and European consumers have enjoyed this convenience for years. For both vendors and consumers, it’s a welcome change as everyone will eventually benefit from improved international acceptance, security and convenience from these new payment systems.
“By encouraging investments in EMV contact and contactless chip technology, we will speed up the adoption of mobile payments as well as improve international interoperability and security," Jim McCarthy, Visa Inc.’s global head of product.
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