EMV: The Next Generation of Paymentss2.q4cdn.com/242125233/files/doc_presentations/2012/2012-ICM_EMV... · The Next Generation of Payments September 20, 2012 Carolyn Balfany Group

©2012 MasterCard. Proprietary.

2012 Investment Community Meeting

EMV: The Next Generation of Payments

September 20, 2012

Carolyn Balfany

Group Head, Product Delivery

Investment Community Meeting ©2012 MasterCard. Proprietary.

MasterCard EMV Video

September 20, 2012 Page 2


EMV Chip Transaction Flow

Card

Authentication Cardholder offers

card to reader

Cardholder

Verification Cardholder enters

PIN or signature

Transaction

Authorization Transaction is approved,

card is removed

Page 3 September 20, 2012


Magnetic Stripe vs. Chip


• Fixed content

• Passive

• Limited data

• One size fits all

• Flexible content

• Active

• High capacity

• Tailored to your needs


No preparation for migration One or more banks migrating or have

completed migration to EMV chip

Penetration of MasterCard-branded EMV cards,

EMV POS or EMV ATMs exceeds 50%

Canada

• 95% of cards

• 70% of POS

• 50%+ of ATMs EMV chip-enabled

Europe

• 70%+ of cards EMV chip-enabled

• 90% of ATMs and POS EMV chip-enabled

Asia-Pacific

• 25% penetration of cards, 50% of POS devices

Latin America / Caribbean

• 80%+ of acceptance now EMV chip-enabled

• Brazil, Mexico, Venezuela, Colombia most advanced

Middle East & Africa

• 12 markets > 40% EMV infrastructure penetration

• 10 markets > 80% ATM penetration

EMV is a Proven, Scalable Technology


Source: Internal data and estimates as of 2Q 2012


Today’s environment is

far advanced from when

EMV was implemented

in much of the world

Large-scale global

deployment has greatly

lowered the cost for U.S.

issuers

24/7 connectivity, mobile

lifestyles, and

smartphones fuel

consumer demand

With 1.5 billion chip

devices in 130 countries,

EMV is a proven,

future-proof platform

Benefits of EMV Chip for U.S. Payments Ecosystem


No preparation for migration One or more banks migrating or have

completed migration to EMV chip

Penetration of MasterCard-branded EMV

cards, EMV POS or EMV ATMs exceeds 50%

Source: Estimates from MA customers, internal data and estimates


Five Key Elements of MasterCard Approach


Liability Hierarchy

Aligning Transaction Rules

Account Data Compromise Protection

Secure All Channels

Industry Coordination

http://www.mastercard.us/mchip-emv.html


MasterCard U.S. Roadmap


October 2012 PCI audit relief

takes effect

October 2015 MasterCard ADC relief takes

effect (100%)

MasterCard liability hierarchies

take effect (excluding fuel)

April 2013 Acquires and sub-processor

mandate to fully process

EMV transactions

Cross-border Maestro ATM

liability shift to non-EMV ATMs

October 2013 MasterCard Account

Data Compromise relief

takes effect (50%)

October 2017 MasterCard liability

hierarchy takes

effect for automated

fuel dispensers

October 2016 MasterCard liability

hierarchy takes

effect for all U.S.

ATM transactions


Government

ACCOUNT

HOLDERS

Tailored Offers and Coupons

Convenience and Savings

Integrated Payment

Experience and Benefits

Enhanced Security

Universal Acceptance

Processor

Benefits of EMV Chip for U.S. Payments Ecosystem


Merchant Acquirer

Issuer


MasterCard Innovation with M/Chip

Page 10

Transit On card data for high speed

transit payment

Mobile EMV strength payments using NFC & secure element

Multi-Account Consumer choice of debit, credit, or prepaid on one card

Display Card On card one-time secure codes and issuer information display

Authentication Highly secure SecureCode /

remote banking

PayPass™

Fast, secure Tap & Go™ contactless payments

Benefit Cards Discounts and other entitlements

integrated with payment

M/ChipTM

September 20, 2012

Documents

EMV: The Next Generation of Paymentss2.q4cdn.com/242125233/files/doc_presentations/2012/2012-ICM_EMV... · The Next Generation of Payments September 20, 2012 Carolyn Balfany Group