With the clock ticking for ATM owners to begin accepting EMV chip cards, BPC Banking Technologies plans to bring software to the U.S. to help banks navigate the complex conversion to smart-card technology on their ATM fleets.
Netherlands-based BPC announced Feb. 18 that its SmartVista electronic payments software will be available to U.S. acquirer processors as they move toward the April 1, 2015 Visa-mandated deadline for ATMs to support EMV technology.
BPC has helped organizations all over the world manage EMV migrations, and the U.S. is in need of that "extra push" to speed up compliance efforts, says Daragh O'Byrne, BPC's chief marketing officer.
"The U.S. payments system is the most complex system on the planet because there are so many different actors and players," O'Byrne says. "Right now, it's as if everyone is waiting to see who will convert first."
The conversion to EMV-standard cards from magnetic-stripe cards is similar to any other technology advancement in that it needs everyone on board to make it work, O'Byrne says.
"The first fax machine didn't mean anything until others had fax machines and the network got bigger," he says. "EMV is a bit like that."
The cost of EMV conversion for ATMs also is holding back financial institutions, says Marc Solomon, BPC's managing director for USA in its Atlanta, Ga., office.
"When the deadlines for EMV were first announced, the banks were looking at it and saying that's three years down the road," Solomon says. "They kept saying other budget items were more immediate, and they kept pushing off the EMV conversion."
Indeed, when Visa Inc. first announced EMV deadlines for the retail sector in August 2011, ATM manufacturers were quick to say collaboration with banks was needed to begin preparations as soon as possible.
BPC's SmartVista software provides authorization switching and routing, full ATM and point of sale management, card management, fraud prevention, loyalty program management, card personalization and production, billing and merchant management and integrated online banking.
Converting ATMs to accept EMV cards takes a significant amount of testing because of the numerous scenarios introduced by the EMV computer chip, compared to magnetic-stripe cards, O'Byrne says.
"There are applications on the chip itself, and these have to be tested as well," he adds.
BPC has a step-by-step migration process that gets carried out in a region-by-region, ATM-by-ATM or card-by-card basis, O'Byrne says.
"We can have some ATMs ready, and others not, but it would not disrupt service because SmartVista can tell which type of card has been entered into the machine," O'Byrne says.
Despite all of the technical aspects that unfold in the complex EMV conversion for ATMs, a more basic, fundamental problem remains for the U.S. conversion, Solomon says.
"There are still many [smaller banks, merchants and consumers] who don't know what EMV means," Solomon says. "They don't understand what EMV is trying to accomplish, so they have to be educated about this."
Industry analyst Russ Schoper of Atlanta, Ga.-based Business Development International Inc., agrees that smaller banks are lagging in EMV preparations.
"For many community banks, this just is not on their radars," Schoper says. "They are not focused on it, unless their state chapters are promoting it."
Because the U.S. represents the "last holdout" for EMV migration, companies from Europe can help with the migration, Schoper adds. "Any advice coming from experiences in Europe has to help," he says.
Of most immediate concern for ATM operators is the MasterCard deadline of April 19 for a liability shift related to the units being prepared to accept internationally issued Maestro cards. MasterCard has set an Oct. 1, 2016 deadline for all ATM operators to handle domestic EMV cards or be held liable in fraud instances. The National ATM Council has asked MasterCard to extend the upcoming April deadline.