EMV Chip technology has been quite popular outside of the United States for many years but has not quite been able to take hold in America.
American Express, however, plans to change this with new cards.
American Express has always been a leader in the virtual payments industry. With safe, secure, and efficient processing theirs are among the most beloved products in the business.
With their innovative marketing and rewards strategies, though, they continue to attract new customers and retain their existing customer base.
Although they are always at the top of their game, they are still an American company and as such their credit cards lag behind those of the system in Europe in terms of security.
Now American Express is making the move to match the best in the world with the announcement that they will be requiring their merchant and payment processing partners to accept EMV Chip -equipped credit cards.
Indeed, American Express will first require their payment processing partners to be in compliance as early as April of next year.
Merchant partners will be required to comply by October of 2015. After this, fraud liability will be the responsibility of the party with the technology that is the least secure or least up-to-date.
To ensure that everything falls into place as quickly and efficiently as possible, though, American Express plans to start issuing the new EMV cards to consumers as early as the latter half of the present year; so, very soon.
According to the report they issued, this action is in response to high customer demand in recent months.
The payments industry is continuing to evolve rapidly, and American Express recognizes the growing demand for chip-based contact and contactless payments in the U.S.
Suzan Kereere, senior vice president and general manager for American Express Global Network Business.
As a global payments network, we understand the benefits associated with EMV-based technology, and we are committed to enhancing security at the point-of-sale for both merchants and American Express Cardmembers.
Of course, if you have been keeping track of the financial industry at all then you should already be quite aware that American Express is the fourth major credit card issuer in the United States to announce the EMV shift. Obviously, they fall behind much larger companies like Visa and MasterCard, who have already revealed similar EMV plans (as told recounted in American Banker).
Altogether, these companies will follow the same or similar time frame for accomplishing these compliance guidelines for completely implementing this new technology. If you have been keeping tabs on the business, then, you might also know that many credit card issuers have already instituted EMV credit cards for affluent accounts over the past few months. This is especially true of cardholders who tend to travel overseas quite often.
For those who do not know what makes EMV cards special, these cards are designed to be much more secure than traditional credit cards.
The reason for this lies in their programming, as they are embedded with what amounts to be a small microchip that stores payment data, as opposed to the magnetic strip of older, less secure credit cards. Studies have shown that credit card fraud is less successful with cards that utilize EMV chip technology than those that do not.
Another thing that many industry experts might agree with is how likely it will be that all nterested parties will favor the new EMV cards.
Apparently most countries in the developed world are already using the new cards, especially in Europe and Southeast Asia. As a matter of fact, countries in these regions use EMV payment technology almost exclusively.