Friday, June 9, 2017
Of the six regions tracked, Europe Zone 1 recorded the highest penetration of EMV card-present transactions, at 97.8 percent, with an adoption rate of 84.9 percent. While Asia Pacific (38.8 percent adoption) and the United States (52.2 percent adoption) lagged behind other regions, the data revealed U.S. adoption nearly doubled year-over-year.
Continued growth in global EMV acceptance is anticipated. EMVCo Executive Committee Chair Soumya Chakrabarty stated that "more recent data will reflect higher adoption rates than the January to December 2016 reporting period, given the current pace of migration in regions such as the U.S. and Asia."
As the final major developed nation to migrate to EMV, the United States has had to address unique challenges. "When we started this back in 2012, there really was a lack of understanding about some of the complexities that exist in the U.S. market that didn't exist in other countries," said Randy Vanderhoof, Executive Director of the Secure Technology Alliance.
Not only were size and scale an issue, but third-party intermediaries unique to the U.S. market made coordination more difficult. "Then we layered Durbin regulations on top of that infrastructure complexity, which was never anticipated in the EMV specifications," he said. "The U.S. had to basically build out a new way in which we could incorporate EMV into debit to support multiple independent routing choices."
While many obstacles were overcome by the October 2015 U.S. liability shift for most retailers, progress has been slow since then. Vanderhoof noted that in Canada, EMV migration took approximately seven years to reach near saturation; other regions, including Western Europe, experienced similar migration timing.
"I think the industry did well in getting through those obstacles in a fairly short window, but here we are four years later and we're still talking about a little over 50 percent of the infrastructure being fully implemented and operational," Vanderhoof said. He pointed to the three-year liability extension for the retail petroleum industry, which represents almost 10 percent of the U.S. market, as another example of just how complex U.S. payment systems truly are.
Vanderhoof added that in pockets of the industry, particularly the restaurant and hospitality sectors, challenges remain with suppliers of the technology due to systems upgrade requirements for highly customized, integrated hardware and software solutions that run POS and business functions simultaneously.
"It really puts the merchant at a disadvantage, because they don't have much leverage," he said. "They can't just throw out the old and put in a new system and be cost effective. You have this myriad of different motivators and business drivers all looking at fraud shift and fraud liability as the key consequence of either doing it sooner or waiting and doing it later."
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