EMV chip and pinEMV chip and pinthe business case the business case

What is EMV?What is EMV?

New Standard in “Chip Card” New Standard in “Chip Card” Technologies Replacing Magnetic Technologies Replacing Magnetic Strip CardsStrip Cards

Originally devised by Originally devised by Europay, Europay, Mastercard and VisaMastercard and Visa

100 Countries in 2004 using the 100 Countries in 2004 using the technologytechnology

What is Chip and Pin?What is Chip and Pin?

An initiative to An initiative to implement the EMV implement the EMV standard for secure payments in standard for secure payments in the U.K.the U.K.

Tested in Northampton in May 2003Tested in Northampton in May 2003 Rolled out in 2004Rolled out in 2004 Mandatory from January 2005Mandatory from January 2005

What are Magnetic stripe What are Magnetic stripe Cards?Cards?

Card Capable of storing data on a Card Capable of storing data on a Magnetic StripeMagnetic Stripe

The first modern charge card was The first modern charge card was issued by Diner's Club in 1950 issued by Diner's Club in 1950

Can be more easily copiedCan be more easily copied Magstripe can be damaged over Magstripe can be damaged over

timetime

Credit Card Fraud…Some Credit Card Fraud…Some FactsFacts

Fraud Fraud costing the industry over costing the industry over £400million a year in 2002£400million a year in 2002

Several Fraud Techniques Several Fraud Techniques commonly used:commonly used:

1.1. SkimmingSkimming

2.2. Shoulder SurfingShoulder Surfing

3.3. Card TrappingCard Trapping

Some Statistics…Some Statistics…

How it WorksHow it Works

The System Utilises Two-factor The System Utilises Two-factor authenticationauthentication

Card read by portable or connected Card read by portable or connected consoleconsole

TransactionTransaction Authorised with end Authorised with end users PIN instead of a signatureusers PIN instead of a signature

The Pro’s…To the BanksThe Pro’s…To the Banks

Decreased liability for banksDecreased liability for banks Reduced costs in authorisation callsReduced costs in authorisation calls Security against counterfeit or Security against counterfeit or

‘skimmed’ magnetic stripe cards‘skimmed’ magnetic stripe cards Generally lower risks due to PIN Generally lower risks due to PIN

VerificationVerification Protection against organised crimeProtection against organised crime

The Pro’s…To the ConsumerThe Pro’s…To the Consumer

Able to be present during card Able to be present during card authorisationauthorisation

Improved customer experience at Improved customer experience at the point-of salethe point-of sale

Faster AuthorisationFaster Authorisation More Piece of mindMore Piece of mind

The Pro’s…To the MerchantThe Pro’s…To the Merchant

Possibility of reduced bank charges Possibility of reduced bank charges and charge-backsand charge-backs

Insulates retailers from effects of Insulates retailers from effects of fraud liability shiftfraud liability shift

Increased sales conversion and Increased sales conversion and improved efficiency due to improved efficiency due to authorization speedauthorization speed

Less paperwork (Receipts)Less paperwork (Receipts)

The Cons…”Chip and Spin”The Cons…”Chip and Spin”

Higher Risk of Cross-country Higher Risk of Cross-country boarder fraud boarder fraud

““Shoulder Surfing” PIN StealingShoulder Surfing” PIN Stealing Liability of Consumer to Keep their Liability of Consumer to Keep their

PIN safePIN safe

ReferencesReferencesWIKIPEDIA.ORGhttp://en.wikipedia.org/wiki/Chip_and_PINhttp://en.wikipedia.org/wiki/EMVhttp://en.wikipedia.org/wiki/Two-factor_authentication#Smart_cardsDATACASH.COMhttp://www.datacash.com/services/chip_and_pin/emv.shtmlCHIPANDSPIN.CO.UKChip and SpinRoss Anderson, Mike Bond, and Steven J. MurdochComputer Laboratory, University of Cambridge.PIN (& Chip) or signature – beating thecheating?Dan Cvrcek, Jan Krhovjak, Vashek MatyasMasaryk University in Brno, Faculty of InformaticsPINPAD.CO.UKSecure solution for EMV chip card acceptance and PINentry at point-of-saleCARDWATCH.ORG.UK