Proximity and the EMV Credit Card
A new rule went into effect October 1 with regards to credit card fraud prevention. As a consumer, the main difference is how you’re using your card to pay for purchases. It made me think about an experience I had with credit card fraud I had a few years back.
While out running errands, I realized I was very low on gas and I stopped by a popular gas station – popular in that it was on a densely populated road, right next to an on-ramp to a major freeway. In other words, it was not the stereotypical abandoned, single gas pump service station that is an overused slasher horror movie trope.
Anyway, needing gas, I swiped a credit card that I only used sparingly and only at gas stations. Fully fueled, I went on my way.
A few weeks later, as I was performing my penance and paying for my purchases, I saw some odd behavior on that credit card. Someone used my card (the one that I used only at gas stations) to run up $300 worth of food at Pizza Hut.
Since I don’t usually frequent Pizza Hut, I opened a dispute with my bank and found out that I, like many others, had fallen victim to a compromised card reader at the gas pump. I got the charges reversed, but it seems like my bank has gotten super sensitive to any possibility of fraudulent activity on my cards to the point where they seemingly send me a new credit card every 12 months or so.
When it comes down to it the technologies, NFC and the EMV credit card work roughly the same way. NFC requires the user to tap their device against a card reader, unique information to authenticate the device and authorize payment is passed back and forth, and the payment is made.
The first replacement card that I received did not look like the other cards. It had a strange chip on the card that looked completely out of place. It sat on the front of the card, slightly off center and close to the left hand side of the card. There was an explanation one sheeter in the letter, but I didn’t pay attention to it. Something about future proofing/enhanced security/blah blah blah.
Fast forward to last spring. I’m up in Canada, and buying lunch. I swipe my card on the card reader. Nothing happens. Swipe again. Nothing happens. I look to the cashier for help, who asks to see my card. Something something EMV credit card, something smart card. (EMV, incidentally, stands for Europay, MasterCard, and Visa, the creators of the standard.) I’m told to slide the card into the slot, with the chip side in, presto, it worked. She seemed to know that I was from the States based on my reaction to this payment process.
So what does this have to do with Proximity?
When it comes down to it, NFC and EMV technologies work roughly the same way. NFC requires the user to tap their device against a card reader, unique information to authenticate the device and authorize payment is passed back and forth, and the payment is made. The EMV credit card does the same, but it requires a card with a RFID chip to be present to authenticate. The cardholder sticks their card into the card reader, waits for a few seconds for the unique transaction information to be passed along, and the transaction is completed. Obviously, the current magnetic stripe on the credit card doesn’t go to that extent to protect users, which is why card skimming devices are such a threat, as I found out personally.
EMV Credit Cards
EMV (see a primer) is slowly beginning its rollout in the United States. The change that went into effect earlier this month that places the liability for the fraudulent transaction on the party (merchant or issuing bank) that is the least EMV compliant. It’s already present in other countries (Canada, for example). To leverage EMV—and it appears vendors will need to in order to avoid liability—businesses will need to have specific devices to utilize the EMV card’s security features. Older card swiping devices likely will not have the ability to read the chip embedded in the EMV credit card.
As devices are replaced with newer tech, it’s likely that the card readers that support the EMV credit card will also allow payments via contact, such as that found on Apple Pay, Android Pay, Samsung Pay and other technologies allowing payment via NFC. Vendors like Square already offer devices that support EMV cards and NFC for payment. The devices are low cost and can be as simple as plugging in a device into the headphone jack on a smartphone.
It’s not the end-all solution to credit card fraud. It is still incumbent on banks and other businesses to ensure their data is secure at a macro level, and as recent articles have pointed out, people are already hard at work to defeat the security offered by EMV at a micro level, but it’s still a large improvement on what’s currently in play for those of us in the United States. From my perspective at least, it gives me some reassurance that the next time I see a purchase for $300 for Pizza Hut, it was my decision to do that.
Smartwhere Proximity Platform
We understand that messaging is difficult. And our full-stack proximity platform allows you to create and send those messages to your mobile users however you see fit, whether the triggers are beacon events, geofences, wi-fi, or even NFC and QR. We also allow you to send those messages based on user profiles and market segments gathered from location-based data. If you’re interested in learning how proximity data can integrate with your existing marketing platform, click below to see the ways in which we can help you better engage with your customers.
Smartwhere is a powerful proximity platform that allows you to quickly and easily integrate proximity solutions into your existing environment. Whether it’s mobile retail, interactive marketing, or location-based advertising, Smartwhere is an all-in-one proximity platform that delivers and manages relevant content to consumers and other end users when and where they need it.