Slideshow 7 Ways EMV Is Invading Mobile Payments

Published
  • November 14 2014, 1:30pm EST
8 Images Total

Mobile tech providers are racing to incorporate EMV chip-and-PIN or chip-and-signature security into their offerings. But many of these companies are taking fundamentally different approaches to linking EMV and mobile technology. (Image: iStock)

Square

Square's recently unveiled chip-and-signature readers, at $29 and $39, are low-priced ways to accept EMV payments. But for a company that has previously offered its readers for free, even a small price tag could be a huge barrier to chip-card adoption.

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Apple

Apple Pay scans mag-stripe cards and enables them for EMV when used through an iPhone. But this security method isn't evident to consumers, so it may not benefit from any of the education issuers do about the added security of chip cards. (Image: Shutterstock)

PayPal

PayPal went with a Bluetooth chip-and-PIN reader, but only outside the U.S. On its home turf, PayPal offers a smaller mag-stripe reader that communicates with a phone via the headphone jack.(Image: Bloomberg News)

Why Not Both?

Ingenico's Roam isn't choosing a signature-only approach like Square's upcoming readers or a PIN-only approach like PayPal's non-U.S. product. Roam offers both options in the U.S., but not at the same cost. Price-sensitive merchants may prefer its chip-and-signature device, while merchants that require more security will want PIN.

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Fuel for Thought

Some merchants are more energized about mobile payments simply because they want to avoid the hassle of adding EMV technology. Gas stations, for example, do not expect their customers to want to leave an EMV-chip card in the pump while they fuel up, so they consider mobile a friendlier alternative. (Image: Shutterstock)

Issues with Issuance

EMV-chip cards cost more than mag-stripe cards, so replacing lost cards could get pricey, especially if consumers switch to another issuer's card while waiting for the new one to be mailed. To ease the pain, JPMorgan Chase may want to rely on technology in its Chase Wallet app, which lets consumers start using a reissued card from their phones before it arrives in the mail. (Image: iStock)

Trojan Horse for Mobile

Hardware makers like Verifone are counting on the U.S. EMV migration to also set the stage for mobile by selling hardware that handles both payment types. This even extends to the micromerchants that use "dongles" attached to smartphones. "Every 'dongle' out there has the potential to be an 'EMV dongle,'" says Verifone CEO Paul Galant (pictured).