Debit Card Processing with EMV
For years the U.S. has lagged behind much of the world in EMV chip card adoption. Anticipating the migration, financial institutions have begun issuing chip-enabled debit cards to their cardholders. Although chip cards are being issued with the traditional magnetic stripes for completing in-store transactions where chip readers are not in use, when paired with EMV-enabled point of sale terminals, EMV cards provide the superior standard for reducing fraud. EMV debit cards create a unique transaction code for each use and require verification with a PIN or signature. This gives cardholders purchasing confidence, knowing their accounts are guarded against in-store thieves and counterfeit fraud.
Despite the clear advantage of chip cards, including limited liability for the issuing financial institution should an in-store accepted card turn out to be fraudulent, Pulse reported that only 25 percent of debit cards were expected to be converted by the end of 2015.1 Though slow to gain full acceptance, that percentage is forecasting to rise to 73 percent by the end of 2016 and 96 percent by the end of 2017.
Strengthening Cardholder Relationships
For financial institutions, swapping magstripe debit cards for EMV has been a hefty and costly shift, averaging $2.17 per chip card for large banks and $2.90 per chip card for credit unions, not to mention the price of updating ATM hardware and software and consumer marketing and education efforts. Transitioning has also meant a shift in processing strategies to comply with increased regulations and requirements. Despite the associated costs, adopting EMV chip cards provide FIs an opportunity to strengthen cardholder relationships and acquire valuable customer insights.
Why Choose Vantiv
Working with Vantiv, the first industry leader to be EMV certified, financial institutions of any size and scope can gain instrumental insight from our fully integrated presence across the transaction chain. Vantiv has a hand at every step of the process in processing billions of debit transactions, gaining insight that gives our active clients understanding of how their cardholders are using their purchasing power. Armed with this knowledge, these intuitions can grow their debit processing and new non-interest revenue to help increase their bottom line.
Faced with the intricacies of navigating the credit and debit card processing payments landscape, institutions have to consider card production, issuing, processing, support, and ongoing security. When making important decisions regarding EMV-enabled debit card processing, many institutions turn to their card processor for guidance.
Vantiv also brings added benefits to debit card security and management, benefits like putting card controls directly into the hands of cardholders. MobiMoney, a mobile app that offers cardholders a convenient way to manage their debit cards, enables cardholders to easily activate and deactivate their cards, receive instant alerts, and limit usage based on location, merchant preferences, transaction type, and threshold amounts – all from their mobile devices. Innovative features like this are just one way Vantiv is helping financial institutions reduce fraudulent transactions while increasing cardholder trust, loyalty, and card usage.
The steps that EMV has made have been significant in reducing card-present fraud; however, without comprehensive debit card processing, financial institutions may be missing the full benefit of cardholder engagement, robbing themselves of the potential revenue gains and desired market positioning. Perhaps the most important aspect of debit card processing is the ability that a processor has to make the most of an issued card – pushing financial institutions to revitalize and grow their debit portfolio, pushing their EMV debit card to the top of cardholders’ wallets.