Many U.S. issuers and merchants aren't sold on signature-only EMV cards — they will most likely take the popular chip-and-PIN approach, but it will take time and it may be a patchwork affair at first.
Most card issuers and merchants already are "way behind" in efforts to migrate to the EMV chip-card standard, according to executives from EMV Academy, a Pasadena, Calif.-based company that provides EMV technology training for banks, merchants and other companies.
"From our perspective, talking to banks and merchants that are seeking help in learning about EMV, the 2015 deadline for liability shifts is very aggressive and there is no certainty most will make it," Stewart Chalmers, executive director of EMV Academy, tells PaymentsSource.
Visa set an October 2015 deadline for merchants to accept chip-card transactions. At that time, Visa plans to shift the liability for fraud on card-present transactions to nearly all merchants that are not equipped to handle EMV cards. Merchants that sell fuel have an extra two years (see story).
EMV Academy launched its U.S. EMV technology-training services last year. It has held 40 workshops within the last nine months with banks, merchants, processors and other parties, Chalmers says.
"So far we are only at the level of educating people as they explore how they are going to go about implementing EMV, and no one has actually begun ramping up for widespread EMV card-issuance or merchant acceptance," he says.
Aside from certain banks that began issuing EMV cards last year to frequent international travelers, most banks will not begin broad rollouts of EMV cards until next year at the earliest, Chalmers says.
As for the debate simmering over whether issuers take an approach to EMV that requires only a signature to authorize transactions instead of the more-common approach requiring a PIN, Gregg Smith, a vice president and partner with EMV Academy, tells PaymentsSource "PINs will probably win out," but it could take years to happen.
The chip-and-signature approach is "much simpler in terms of time and money," which explains why Visa originally began steering the industry in that direction, Smith suggests.
"It's possible" that some issuers will stick with a signature-only approach while others will opt for PIN and the two approaches will coexist, Smith says.
So far Visa supports a signature-only approach for U.S. issuers. MasterCard in January announced its own initiatives, which lean toward requiring a PIN for authorization (see story).
MasterCard this week issued a call for industry-wide collaboration on the U.S. migration to EMV, specifically noting the need to "standardize the consumer experience" (see story).
"Going the chip-and-signature route is a gentler way to get people started, but if you're going to all the trouble of adopting EMV, it rather defeats the purpose if you don't require a PIN for maximum security," Smith says.