	About Smart Cards : Applications : EMV

EMV Resources

Increasing counterfeit card fraud led the financial industry to move to smart chip technology for bank cards and to develop the global EMV standard for bank cards based on chip card technology. The EMV specification, first available in 1996 and managed by EMVCo, defines the global interoperable standard for smart bank cards.

Financial institutions in Europe, Latin America, Asia/Pacific and Canada are issuing contact or dual-interface EMV smart cards for credit and debit payment or migrating to EMV issuance. As of the third quarter of 2009, more than 826 million EMV payment cards were in use worldwide and 11.5 million EMV point-of-sale terminals have been deployed. Payment brand mandates have driven or are driving Europe, Asia, Africa, Latin America and Canada to EMV.

EMVCo developed its specifications to ensure global interoperability–so that any EMV-compliant card can be accepted at any EMV-compliant point-of-sale anywhere in the world. The EMV specifications not only define how chip cards can be used for fraud prevention but how they can be used by issuers to offer additional features to cardholders such as multiple payment applications on the same card. Chip cards can carry security credentials that are encoded by the card issuer at personalization. These credentials, or keys, are encrypted and impervious to access by unauthorized parties. These credentials therefore prevent card cloning, one of the common ways magnetic stripe cards are compromised and used for fraudulent activity. In practical terms, this means that chip card-based payment account information cannot be skimmed, which increases the level of security to prevent fraud.

Fraud prevention technology in chip-based EMV payment cards (which can be contact, contactless or dual-interface cards) complements post-fraud detection mechanisms by providing an additional layer of intelligence to protect consumers. Issuers, acquirers and merchants in a large number of markets around the world have decided to implement full EMV technology. Some programs are signature-based and others use a PIN, commonly known as “chip and PIN,” to combat fraud.

About EMV

The EMV Integrated Circuit Card Specifications are managed by EMVCo, which is currently operated by American Express, JCB International, MasterCard International, and Visa International. EMV specifications were first issued in 1996 and active working groups have provided updates and revisions. In December of 2000, EVM 4.0 was released which is also known as EMV 2000. The current version of EMV is release 4.2.

At the heart of EMV is the underlying security framework that provides fraud protection for both offline and online transactions. The security is a combination of symmetric and asymmetric key technology. First, EMV leverages the security found in chip cards and requires symmetric authentication keys to be submitted to gain access to the chip card’s memory. In addition, asymmetric keys and certificates, also known as public key infrastructure (PKI), are incorporated to facilitate card authentication in offline transaction environments.

EMV and the U.S. Market

The United States is the only country with no current plans for EMV. Within the U.S., however, contactless credit and debit cards are now being issued and include some EMV security features. Some analysts are forecasting that, in 2010, the U.S. market will move to issuing EMV chip cards for U.S. cardholders who travel internationally.

Smart Card Alliance Resources on EMV and Fraud

Top 10 Reasons U.S. Should Consider EMV webinar, Smart Card Alliance Payments Council webinar, January 2010
EMV Chip Cards Expected for Upscale U.S. Cardholders, Smart Card Alliance Payments Council statement, November 2009
EMV Migration Study and Market Analysis on Mexico and Brazil (fee), market study conducted by First Annapolis Consulting for the Smart Card Alliance Latin America and Visa
Fraud in the U.S. Payments Industry: Fraud Mitigation and Prevention Measures in Use and Chip Card Technology Impact on Fraud, Smart Card Alliance white paper, October 2009
End-to-End Encryption and Chip Cards in the U.S. Payments Industry, Smart Card Alliance position paper, September 2009

The Smart Card Alliance Payments Council has also created a LinkedIn group, Smart.Payments, open to the public to stimulate discussion of payments-related topics.