Visa to Help Accelerate EMV Chip Migration and Support Merchants

Streamlined certification, financial and technical support to further
accelerate EMV chip terminal deployment

Modified chargeback policies will provide near term relief to
merchants who are not yet chip-ready

SAN FRANCISCO–(BUSINESS WIRE)–Visa Inc. (NYSE:V) today announced a series of initiatives to help
accelerate EMV chip migration for merchants. Visa has streamlined its
testing requirements, amended and simplified the terminal certification
process, and committed to investing further resources and technical
expertise in a manner that can reduce timeframes by as much as 50
percent. Visa is also making policy changes to help limit exposure to
counterfeit fraud liability for merchants who are not yet chip-ready.


While the U.S. migration to chip technology is a significant
undertaking, tremendous progress has been made to-date with over 300
million chip cards in market and 1.2 million merchant locations now
accepting chip cards. An average of 23,000 new merchant locations become
chip-ready each week. Despite the success to date, a migration of this
size takes time and hence many merchants still require help to cross the
finish line.

Streamlined Implementation

Before a merchant can turn on a new chip terminal, it needs to be tested
to ensure it works properly for the merchant and cardholder. Chip
technology can be implemented in different ways based on the unique
needs of a merchant, and therefore, different merchants need to be
tested in different ways. The more complex a merchant’s point of sale
environment, the greater the number of tests. However, Visa has
streamlined its testing requirements to significantly reduce the
complexity, time, and cost of implementation.

By way of example, a national grocery chain recently followed Visa’s
streamlined approach and completed development, testing, and
certification months ahead of schedule.

Acquirers Can “Self-Certify” Their Solutions

Going a step further, Visa will provide acquirers greater discretion to
determine the appropriate level of testing required to ensure a
merchant’s solution is ready. Acquirers know their merchants better than
anyone, so providing acquirers with the commercial flexibility to
self-certify their clients will further reduce certification wait times
for solutions that acquirers are confident are ready.

Visa is also exploring a system for acquirers to share certification
test results with each other to avoid testing duplication. That is, if a
certain merchant configuration (e.g., restaurants with specific hardware
and software) is known to consistently work with one acquirer, then
other acquirers should be aware of this and take it into consideration
as they make their decisions.

Incremental Funding and Resources to Support Migration

Visa will increase its investment to support both acquirers and the
value-added resellers (VARs) that develop the software to power chip
terminals. Visa funding will be available to help acquirers with any
specific resource constraints they may be facing, as well as to help
VARs pre-certify their software solutions in a manner that will
significantly reduce the subsequent testing at acquirers by up to 80
percent.

In addition, Visa will provide hands-on support to VARs who may need
technical information, education, consulting, and training. A dedicated
team of Visa experts will be available to provide direct support in the
form of webinars and direct one-on-one conversations, as needed.

“Visa recognizes the importance of having the industry help merchants
get their chip terminal solutions up and running quickly so that
everyone, especially consumers, can benefit from the powerful security
protection of chip technology,” said Oliver Jenkyn, Group Executive
North America, Visa Inc. “We’ve taken steps to simplify the process as
much as possible and help reduce any challenges so merchants can move
forward with chip adoption quickly.”

“Vantiv has been relentlessly working to help merchants upgrade their
point-of-sale systems to new levels of security with EMV,” said Royal
Cole, Group President, Merchant and Financial Institution Services at
Vantiv. “To help accelerate this process, we’ve been working with Visa
to find comprehensive ways to further streamline the conversion process
for the entire ecosystem – from software developer partners to the
smallest-sized businesses. We are very encouraged by the new measures
and programs that Visa is announcing today, and we hope others will join
in instituting similar programs.”

Counterfeit Chargeback Policy Changes

Historically, issuers have been responsible for the full cost of
counterfeit fraud that takes place at a merchant. In 2011, to support
the migration to EMV chip technology, Visa announced a liability shift
that became effective in October 2015. With this change, the cost of
counterfeit fraud is the responsibility of the party – either the
merchant or the issuer – that has not implemented chip technology. Given
that some merchants are still working to get their chip terminals
enabled and certified, they may now be bearing the cost of counterfeit
fraud originated in their stores. Visa’s actions today seek to alleviate
the impact on merchants while they work through the transition.

Visa is modifying its policies to limit the number of fraudulent
transactions that issuers can charge back to merchants (and their
acquirers). Effective July 22, 2016, Visa will block all U.S.
counterfeit fraud chargebacks under $25. These smaller chargebacks
generate a great deal of work and expense for merchants and acquirers,
with limited financial impact for issuing banks. In addition, effective
October 2016, issuers will also be limited to charging back 10
fraudulent counterfeit transactions per account, and will assume
liability for all fraudulent transactions on the account thereafter.
This reinforces the responsibility issuers already have to detect and
act on counterfeit fraud quickly. These blocks will stay in effect until
April 2018.

These two changes together will significantly reduce the number
chargebacks that merchants are seeing. Following these changes,
merchants can expect to see 40 percent fewer counterfeit chargebacks,
and a 15 percent reduction in U.S. counterfeit fraud dollars being
charged back.

For more information, acquirers and processors should contact their Visa
account executive.

About Visa Inc.: Visa Inc. (NYSE:V) is a global payments
technology company that connects consumers, businesses, financial
institutions and governments in more than 200 countries and territories
to fast, secure and reliable electronic payments. We operate one of the
world’s most advanced processing networks — VisaNet — that is capable of
handling more than 65,000 transaction messages a second, with fraud
protection for consumers and assured payment for merchants. Visa is not
a bank and does not issue cards, extend credit or set rates and fees for
consumers. Visa’s innovations, however, enable its financial institution
customers to offer consumers more choices: pay now with debit, pay ahead
of time with prepaid or pay later with credit products. For more
information, visit usa.visa.com/about-visa,
visacorporate.tumblr.com
and @VisaNews.

Contacts

Visa Inc.
Sandra Chu, +1 415-805-4124
sanchu@visa.com
Lea
Cademenos, +1 415-805-4271
lcademen@visa.com