Wednesday , August 5, 2020

Nearly 40% of U.S. Visa Credit and Debit Cards Now Have an EMV Chip

Nearly 283 million Visa-branded credit and debit cards issued by U.S. financial institutions now have an EMV chip, Visa Inc. reports. In addition, some 1.1 million U.S. merchant locations that accept Visa cards now take chip cards.

In the latest of the payment card networks’ updates on the U.S. chip card conversion that officially began last October, Stephanie Ericksen, Visa’s vice president of global risk products, tells Digital Transactions News tells that some 282.9 million Visa cards had a chip as of April 20—145.7 million debit cards and 137.2 million credit cards.

Chip cards now account for 39% of Visa’s approximately 725 million U.S. cards in issue, or 50% of all credit cards and 33% of debit cards, according to Ericksen.

Credit cards had an early lead in the EMV conversion, but debit cards surpassed them in Visa’s report for March. Now debit’s lead is widening, which is no surprise given that debit cards account for about 59% of all Visa cards. “So now debit is really starting to catch up and surpass credit in the market,” says Ericksen.

On the acceptance side, Ericksen says 20,000 to 25,000 new merchant locations are taking chip cards. The tally is now 1.1 million locations, or 24% of the Visa merchant base, and up 10% from 1 million at the end of March.

Visa’s merchant figure is lower than the 1.4 million recently reported by MasterCard Inc., but since the Visa and MasterCard merchant bases in the U.S. are virtually identical, Ericksen attributes the discrepancy to differences in the networks’ data-collection methodologies. Visa counts as an EMV-accepting merchant one that has generated at least one Visa chip card transaction within the preceding month.

While a number of big retail chains are taking chip cards, small and mid-sized merchants are generating three-quarters of Visa’s EMV transactions. In part, that’s because smaller retailers have less complex tasks in retrofitting their points of sale for chip cards, or are buying new systems, including those from mobile-based processors, where EMV chip acceptance is standard, Ericksen says. “The small and medium-sized businesses are continuing to upgrade.”

Chip cards also are beginning to have their desired effect in reducing counterfeit fraud, according to Visa. Dollar losses from counterfeit fraud at merchants accepting Visa chip cards were down 26% in January from January 2015, according to Ericksen. “There’s some merchants that have had even more significant decreases,” she says, adding that 15 of the 25 merchants with the most counterfeit fraud losses now can accept chip cards.

The network liability shifts that took effect last October assign financial responsibility for counterfeit fraud to the merchant or card issuer involved in a point-of-sale purchase that did not support EMV. In its latest EMV report, MasterCard said counterfeit fraud at a group of large EMV merchants fell 39% from January 2015 to January of this year.

The POS liability shifts are causing fraudsters to shift their attention to the vulnerable card-not-present channel. Visa did not have recent CNP fraud figures available Monday.

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