By Karisse Hendrick, Editor-at-Large, CardNotPresent.com
Previously in this series, we explored the reasons for implementing EMV chip-enabled cards in the U.S. market, the possible effect on CNP fraud and how tokenization and encryption technology can improve card security in the CNP environment if CNP fraud does surge. In this final article, various players in the card-not-present ecosystem from merchants to the card brands share their thoughts and predictions on what EMV will mean for the card-not-present environment. Will the U.S. experience the increases in CNP fraud other countries did? Or, are U.S. companies using more advanced fraud-prevention strategies than companies in other markets were when they made this shift? And most importantly, what should CNP merchants do now to prepare for a possible increase in fraud?
EMV and CNP Fraud: Cause and Effect?
While it’s a fact that CNP fraud surged in Europe and other markets after EMV was implemented, not everyone believes the causal link is firmly established.
“The EMV launch in Europe coincided with a rapid increase in CNP volume as a whole,” says Jamon Whitehead, senior manager of risk and payment operations at Backcountry.com. “Existing merchants were moving to the Web, pure-play merchants were launching straight to the Web and customers were migrating from an in-store to an at-home shopping experience. At the same time, criminals were realizing that perpetrating CNP fraud was easier, safer and more anonymous than in-store/counterfeit fraud could ever hope to be.”
An additional factor that came into play during the EMV conversion in the U.K. and in other markets was