Foster City, Calif. – Visa Inc. and MasterCard Inc. are teaming up to create a new group that will focus on improving payment system security. The group will include banks, credit unions, retailers and initially focus on adoption of EMV (Europay, MasterCard, Visa)-compliant card technology in the U.S. in advance of the October 2015 liability deadline.
The group will also study tokenization, or the replacement of customer account numbers with unique digital payment codes, and also cooperate with other industry groups.
“The recent high-profile breaches have served as a catalyst for much needed collaboration between the retail and financial services industry on the issue of payment security,” said Ryan McInerney, president of Visa.
In response to the formation of this group, the National Retail Federation issued the following statement from senior VP and general counsel Mallory Duncan:
“We remain insistent that U.S. retailers’ customers be given the same protections as consumers in more than 80 countries who have both a chip and a PIN securing their credit and debit cards,” said Duncan. “There is no single solution to the complex issue of criminal hacking and we know PIN-and-chip is just a bridge on the long road to a safer payment system, but it is an important step in the right direction.
“We appreciate being involved in meetings with other stakeholders such as the one hosted by Visa and MasterCard last week. While we certainly agree that speed is of the essence, we don’t believe that is an obstacle to introducing PIN-and-chip cards since the technology is well established and the cards are widely used around the globe.”
“Easy-to-forge signatures are a virtually worthless form of authentication. Insisting on chip-and-signature cards is like installing an alarm on the front door of a home while leaving the back door wide open. It doesn't make sense when the technology exists to secure the entire house.”