EMV chips in credit and debit cards slow fraud, but don’t stop it. Tokenization promises to bolster consumer protections.
After more than a year of chip credit and debit cards in the U.S., the transition shows sure signs of progress.
Card providers can’t stop government regulation on interchange fees. But they can focus their card portfolios to make them more personal, productive and nimble.
The U.S. card industry’s move to EMV technology to combat fraud will likely accelerate because of recent data breaches, say BAI Payments Connect 2014 panelists.
Although the regulatory blow to debit interchange will be less than feared, banks still face the challenge of recasting their overall retail payments line of business.
Although the Durbin rules will hammer debit card profitability, bankers should keep the big picture in mind: debit is still better than many alternatives.
Economic pressures and government regulation have accelerated the use of debit over credit cards during the last two years, according to a BAI Research/Hitachi Consulting study.