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Will Mastercard and VISA Agree to Support a Common App for EMV in Order to Meet the April 1 Deadline?


Posted on Jan 02, 2013

Card payments using the Europay-MasterCard-Visa (EMV) chip are common in many parts of the world. The US card industry has been slow to accept this new standard citing the high cost of implementation. WIth the increasing cost associated with PCI compliance, coupled with mounting losses from the breach of card holder data, the industry has recently made an about face. The major card brands are trying to push the adoption of this new standard by requiring U.S. merchant processors to be capable of accepting EMV transactions as early as April 1, 2013.

There is a looming issue with the current EMV technology in that it is proprietary to each card brand and thereby tying the processor to a specific network. This is clearly incompatible with the Durbin requirement for merchants to be able to choose between at least two unaffiliated networks. According to a report in Digital Transactions, a working group of the Secure Remote Payment Council has developed a strategy for using a common application that would allow merchants to accept the EMV enabled payments and have the ability to route the payments to more than one network. 

The premise of the common app is to outline standard format that allows merchants to have the routing choice as mandated by the Durbin Amendment. Additionally, the common app would also make it easier for issuers to switch networks. Although the common app concept seems to solve some of the basic compliance problems with the new EMV mandate, Mastercard and VISA may be reluctant to give up on the exclusive nature of tying the EMV standard to a specific network. 

Mastercard and VISA are planning to reach a conclusion regarding the common app proposal by mid-January. However, those closest to the card payment industry suspect that regardless of the decision, the April 1 deadline will likely be pushed back.

News source:  Digital Transactions