On June 29, 2012, American Express Co. released its road map for Europay/MasterCard/Visa (EMV) chip-based POS environments throughout the United States. Thus, AmEx, the third-ranked card brand in the United States, joined the two leading brands, Visa Inc. and MasterCard Worldwide, in pushing merchants to implement the EMV global standard for authenticating credit and debit card transactions.
EMV cards are accepted throughout most of the world and are deemed to be more secure than mag stripe card payments, which predominate in the United States. The card brands are now accelerating adoption of the standard in the United States by imposing new liabilities on merchants who do not update their POS equipment to adopt EMV technology.
AmEx's EMV push was not surprising; it is one of the four founding payment organizations of EMVCo, the organization driving adoption of the EMV standard worldwide. AmEx said it will begin issuing EMV-compliant cards in 2012 that will support EMV chip and PIN, chip and signature, contactless and mobile POS transactions.
In sync with Visa and MasterCard deadlines, AmEx is requiring that its processors be able to support AmEx EMV chip-based contact, contactless and mobile transactions by April 2013. Then, starting in October 2013, merchants will be eligible for relief from some Payment Card Industry Data Security Standard reporting requirements "if the merchants' point-of-sale (POS) acceptance locations, where 75 percent of their transactions occur, are enabled to process American Express EMV chip-based contact and contactless transactions," the company noted.
AmEx is also instituting a fraud liability shift effective October 2015 like the ones being imposed by Visa and MasterCard. For certain kinds of transactions, AmEx is shifting fraud liability away from the party that has the most secure form of EMV technology. AmEx petroleum retailers will have until October 2017 to comply before they face the potential for new liability. This is because of the complicated nature of the petroleum market and its transactions.
Suzan Kereere, Senior Vice President and General Manager, Global Network Business at AmEx, said, "We fully recognize the complexities involved in migrating to EMV chip-based technology, and our first priority is to provide choice and flexibility for merchants and our card-issuing partners so they can adopt the EMV solution that best meets their needs."
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