Visa to quicken move to mobile payments - Mobile World Live

Visa to quicken move to mobile payments

10 AUG 2011

Visa to quicken move to mobile payments

10 AUG 2011

US card giant Visa has announced plans that it hopes will ultimately encourage US merchants to more rapidly adopt NFC-based mobile payment systems. The company says its plans will initially accelerate the migration from magnetic-stripe cards to chip-based EMV contact and contactless chip technology.  By adopting dual-interface chip technology, Visa says it will prepare the US for the arrival of NFC-based mobile payments: “As NFC mobile payments and other chip-based emerging technologies are poised to take off in the coming years, we are taking steps today to create a commercial framework that will support growth opportunities and create value for all participants in the payment chain,” said Jim McCarthy, Visa’s global head of product.

The US is lagging Europe in a move to a chip-and-PIN infrastructure which is viewed as more secure than magnetic-stripe cards. Visa has made three announcements to incentivise the move by merchants towards what is termed dynamic chip authentication technology. From October 1 next year the company will spread its Technology Innovation Program (TIP) to the US. The program cuts out the requirement for merchants to annually validate their compliance with the PCI Data Security Standard for any year in which at least 75 percent of its transactions originate from chip-enabled terminals. This is attractive to merchants because it removes the costly headache of PCI compliance.

Secondly, Visa will insist on US processors and sub-processors to be in a position to support merchant acceptance of chip-based transactions no later than April 1, 2013. Finally, the company plans to stop the requirement for banks to reimburse most merchants for certain credit card fraud which can be stopped by using EMV-based systems, another incentive for merchants to shift to the chip-based technology.

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Richard Handford

Richard is the editor of Mobile World Live’s money channel and a contributor to the daily news service. He is an experienced technology and business journalist who previously worked as a freelancer for many publications over the last decade including...

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