For Immediate Release
October 7, 2015
ABA Media Contact: Jeff Sigmund
(202) 663-5439
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ABA to Congress: Banks Committed to Helping Small Businesses Protect Consumers

Bankers emphasize that the chip, not a PIN, combats counterfeiting

WASHINGTON — America’s bankers are committed to helping their small business partners as the payment industry leads a major card security upgrade that will protect consumers and brick-and-mortar merchants from scammers who use counterfeit cards, according to a statement for the record the American Bankers Association submitted today for a House Committee on Small Business hearing entitled, “The EMV Deadline and What it Means for Small Businesses.”   
ABA noted that the transition to EMV credit and debit chip cards is all about security. Chip cards are almost impossible to copy or counterfeit, and banks have been moving quickly to put this security upgrade into consumers’ wallets.  Most people have at least one chip card in their wallet now, and the association estimates that 575 million chip cards will be issued by the end of 2015.  In addition, at least 95 percent of merchants are aware of EMV chip cards.  As a result of bankers helping their small business customers upgrade, consumers should start to see more point-of-sale terminals that accept EMV chip cards.  This is critical because this advanced technology only works when merchants have chip-card readers in their stores.
“Banks have worked closely with small businesses throughout the upgrade process to ensure that they are prepared,” ABA said in its statement. “Several banks and merchant services companies have offered incentives to offset costs involved in upgrading terminals, making them free in some cases…It is also important to emphasize that consumers will continue to enjoy the same protections for fraud – zero liability in most cases.”
ABA emphasized that while EMV chips are an important innovation to better protect consumers’ financial data, they are just one part of the broader effort being made by banks and networks to combat hackers and other criminals.  Other innovations include tokenization technologies like Apple Pay, which replace account numbers with a random number at the point of purchase, rendering it worthless to thieves who breach retailers’ systems. The terminals that small businesses install for this EMV chip card upgrade often make the small businesses “future-ready” for these popular payment technologies, which their customers are demanding. In addition to today’s sophisticated “neural networks” that spot fraud at the point of sale, these technologies are being layered with EMV to create multiple dynamic layers of security necessary to fight increasingly sophisticated forms of fraud. The goal, says the association, is to create a web of protections that surrounds consumers in every payment environment.
“We do not know what thieves might do next, which is why dynamic security features are so critical and why mandating a static technology (such as Personal Identification Numbers, PINs), as some advocate, is a mistake,” ABA said.
ABA emphasized that the chip, not a PIN, combats counterfeiting, the biggest source of in-person fraud affecting America’s small businesses.
To read ABA’s full statement for the record, please click here.
The American Bankers Association is the voice of the nation’s $16 trillion banking industry, which is composed of small, regional and large banks that together employ more than 2 million people, safeguard $12 trillion in deposits and extend more than $8 trillion in loans.
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