EMV Migration in the US Progress Report: What Progress?

by Zilvinas Bareisis, November 21, 2013
Global

Abstract

EMV migration in the US has been painfully slow. Celent investigates the main factors hampering progress, reviews EMV impact on issuers, and offers predictions for EMV in the US.

EMV, a chip-based card payments technology, is widely adopted around the world and offers a number of benefits to the payments industry. However, the US is the largest market that has not yet adopted EMV and it is beginning to feel the effects. Fraud rates are escalating while customers are experiencing difficulties trying to use their cards abroad.

In EMV Migration in the US Progress Report: What Progress? Celent provides an objective assessment of the US EMV migration, offering predictions for tomorrow and providing advice to issuers on what they need to consider.

“There are at least five factors today hampering EMV progress in the United States,” says Zilvinas Bareisis, Senior Analyst with Celent’s Banking Group and author of the report. “For example, the uncertainty around Judge Leon’s ruling and Reg II has largely stalled any EMV activity around debit.”

In this context, the first question each issuer needs to answer is whether it plans to issue EMV cards at all. The next question is when. Issuers need to plan how they will address EMV’s impact on five major areas:

  1. Card product management and marketing.
  2. Back office systems.
  3. Authorization systems.
  4. Customer services.
  5. Education and communication.

Whether to outsource or keep/establish systems in-house is an important consideration when planning the IT aspects of EMV migration, also discussed in this report. The report concludes with Celent's top three predictions for EMV in the US.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is part of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America (Boston)
Tylor Tourville
ttourville@celent.com
Tel.: +1 617 424 3284

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)208 870 7875

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81.3.3500.3023

Table of Contents

Executive Summary

1

Introduction

3

A Brief Introduction to EMV and Its Benefits

4

EMV Migration in the US: Progress Report

8

 

A Decent Start, But Slow Progress to Date

8

 

Five Key Issues Hampering Progress

10

Recommendations for Issuers

18

 

Key Areas of EMV Impact

18

 

Sourcing Considerations

21

Celent’s Predictions for EMV in the US

23

Leveraging Celent’s Expertise

25

 

Support for Financial Institutions

25

 

Support for Vendors

25

Related Celent Research

26

Sign in to download reports and access personalized information