Less than three years ago, Visa described a financial institution's request to issue EMV-chip cards as "a unique situation" and "not an everyday query." Times have certainly changed.
Visa now has a backlog of issuers that runs to October, said Stephanie Ericksen, Visa's head of authentication product integration, at SourceMedia's 25th annual Card Forum & Expo last week.
Visa and the other card brands began publishing largely identical timeframes for U.S. companies to handle EMV cards in 2011, with an end goal of having most merchants capable of accepting EMV transactions by October, 2015.
A deadline for acquirer processors just passed, and one for ATM operators will hit this week. Though magnetic-stripe cards are still abundant, large banks now offer EMV cards to targeted customer segments.
"Some U.S. issuers have already begun issuing chip cards, particularly to their frequent international travelers and we expect issuance to accelerate as we get closer to October 2015," Ericksen said in an emailed statement after the event.
As of June 30, 2012, U.S. financial institutions had issued 1.5 million chip cards, Visa says.
The April 1 deadline for acquirer processors served as an enablement milestone, Ericksen says. "For merchants to be able to start accepting, the acquirers would need to be able to handle [EMV]," she said in a panel discussion at the event.
Ericksen has worked for Visa 20 years, of which she spent 18 working in other countries on EMV migration with Visa's international partners.
Since the U.S. is one of the last countries to switch to the EMV standard, which provides greater security than magnetic-stripe cards, fraud here has spiked, with "an ATM being the favorite one for fraudsters," said Carolyn Balfany, group head of U.S. product delivery at MasterCard, at the event.
Fraudsters consider ATMs "magic boxes of cash," she says.
But there are advantages to switching last, since the U.S. can now learn from other countries that have migrated, Balfany says.
While many other countries use a PIN with EMV cards, some U.S. issuers require only a signature.
Requiring a PIN, particularly for credit cards, could add cost and complexity to the migration, says Ericksen.
Discover Financial Services also allows chip-and-signature authentication, though merchants should be able to accept both types, says Troy Bernard, director of chip payment technology at Discover, at the event.
"Chip-and-PIN is more preferred than chip-and-signature," he says. The U.S. "may migrate in the future from chip-and-signature."