EMV Technology To Make Electronic Payments Cheaper; FIME Urges Indian Companies To Adopt It

EMV Technology is heralded to be the next stage of global simplification in backend processing of payments made electronically. But the time to act is now, stresses, FIME, a Bangalore based consulting and testing services company for payment solutions. Globally, the two electronic payment majors MasterCard & VISA are collaborating to introduce & ensure growth of their electronic payment solutions. Additionally, India too has affirmed its support in this endeavor. In fact, Reserve Bank & NCPI, recently launched EMV payment scheme, RuPay & is aimed at providing security and financial inclusion for India’s largely un-banked population.

What is EMV?

Europay, MasterCard and Visa (EMV) have jointly come up with the stable electronic payments (e-payments). Based on smart-chips inserted into virtually all instruments of payment, the companies are trying to eradicate the loophole for financial fraud. The chip allows electronic access to the Credit/Debit card & hence is supposed to genuinely authenticate the user utilizing the card. Without the chip, Point of Sale (PoS) personnel currently have to physically verify the ownership & such feeble security can be easily bypassed.

Across the globe, countries are busy realigning their payment processing policies & procedure to comply with this new standard. Once completed, payments across continents will not only be safer, they will be faster & cheaper too. With automated authentication, banks could easily lower processing charges & this would simply translate into lower overheads when transacting. Since Governments are involved, this conversion & adoption of newer standards is not only urged, its mandatory says a confident Prakash Sambandam, MD, FIME India, “Due to the global momentum towards EMV and the drive by the Reserve Bank of India to stabilize the country’s payment framework, a mandate for EMV technology is expected to be issued in early 2013. Once agreed, banks and other payment stakeholders will be required to adhere to the standard”.

Will the end-user have to do anything? Since the electronic chip will be embedded within the card, present account holders will eventually have to approach their respective banks/financial institutions to hand-over the, then obsolete cards, in lieu of new cards. Though this exercise may seem cumbersome, it should improve services & safety. Do you see any problems in the implementation? Do let us know your views.

Image Courtesy |  incyprustoday

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