MONTREAL, Quebec—To avoid the costs of doing a mass reissue of the card base by the Oct. 1 liability shift deadline, some credit unions are taking a very targeted approach to converting to EMV.
Some CUs are analyzing which members are currently using their cards at large merchants—such as Walmart—that are expected to be EMV ready by Oct. 1.
Lesley DeCator of Vantiv speaking to recent NAFCU meeting.
Post deadline, the cost for the fraud shifts to the weakest link in transaction. That means if the POS terminal is EMV-enabled and the issuer’s card is not, the issuer foots the fraud bill.
Some analysts have noted the obvious, that the mass reissuing the card base can be expensive, and that cost should be weighed against potential fraud losses from reissuing as cards expire.
By determining the members who heavily use major retailers expected to be ready by Oct. 1, CUs could possibly limit some of its losses from hanging onto mag strip a little longer.
Lesley DeCator, VP, senior card program manager for Vantiv, told attendees at NAFCU’s annual meeting here that she was aware of the practice.
“We are also aware that some credit unions are converting their high-net-worth cardholders first, as well as those who travel a lot overseas,” explained DeCator, who said Vantiv is a proponent of financial institutions performing mass reissues to protect themselves from fraud losses.
However, experts have stated that with the majority of merchants expected not to be EMV ready by Oct. 1, the overall low percentage of card present fraud, and that it will take crooks some time to zero in on the financials that are keeping mag stripe, FIs could reissue cards as they expire. But sources added that if the CU takes this approach it should closely monitor the card base for spikes in fraud and then mass reissue at that point.