The USA is slowly moving over to EMV chip and PIN technology. The newest example is Bank of America Merrill Lynch’s announcement that it is expanding chip and PIN technology to all purchasing and travel credit card products available to clients in the United States. This, they say, is the latest development in the company’s ongoing effort to rollout EMV® (EuroPay Mastercard Visa) technology to its global client base.

“We’re committed to providing the most technologically advanced solutions, which our clients increasingly need to improve efficiencies while adding another layer of security,” said Kevin Phalen, head of Global Card and Comprehensive Payables in Global Transaction Services (GTS). “More of our clients are asking for chip and PIN capability – not just for their key executives but for their entire employee base – and we have directed significant investments into our card platform to meet that demand.”

BofA Merrill first introduced chip and PIN technology on corporate travel and expense (T&E) credit cards in Europe in 2010 and in the United States in 2012. “Chip-enabled cards allow the employees of our clients to travel the world safe in the knowledge that their cards will be accepted at any point of sale,” added Phalen. This last point is critical, having a payment card that doesn’t work in parts of the world, destroys the key reason why to carry the card.

BofA Merrill bank began issuing chip-enabled purchasing cards in 2013. Together with T&E cards, more than 100,000 chip and PIN cards across the portfolio have been issued to clients in the United States alone. 

EMV technology impact on fraud

EMV, or chip, technology allows card holders to make payments through chip-enabled merchant terminals that are regularly used in countries outside the U.S. Every chip card transaction is uniquely encrypted, adding protection against counterfeit fraud, and requires a PIN to access. Analysts estimate that only 1-5% cards in the US have chips, but within 2-3 years, they expect that 90-95% of cards will have chips. Although this will be hard to achieve, given the lack of experience in the USA with chip and pin technology. 

Chip and PIN technology main impact will be on reducing counterfeiting as it much more difficult to produce duplicates. This is vital as hackers are now releasing millions of credit card details from retailers, e.g. Target.

The other impact is that as EMV rollout progresses, fraudsters will concentrate on magnetic stripe only cards, and avoid the EMV chip and pin cards. This will happen in the US and then, as US adopts EMV increasingly, fraud will migrate to other countries, just as happened in Europe

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CTMfile take: Do not be the last to move to EMV chip and pin, it could cost you. Ask your card issuer and merchant acquirer when they are they moving to chip and pin.