Expanding the Picture
WASHINGTON -- While cooperation in fighting fraud among all the parties that benefit from the use of cards came up repeatedly at the summit as both a need and a goal, the summit also inadvertently highlighted how far short of that goal the card industry remains.
Coughlin told the attendees that while the percentage of Level I merchants, those who process the most card transactions, 50% of the card brand's total each year, that comply with the card brand's card security has risen from 15% to 33%, that still leaves 66% who are not compliant.
In response, Visa said it would pay out more than $20 million in incentives to merchants to go ahead and comply with the standards, as well as making a key change to how it calculates interchange. Coughlin announced that Visa would make its best interchange rates only available to merchants who comply with its card security standards by September 30, 2007, a move that could be seen as a carrot, but also as a stick.
The card brand has had more luck with card processors, Coughlin reported. Over 85% of the card processors that merchants use to process their card transactions are compliant with the card security standards and the majority of those remaining will likely be compliant before the end of the year. --email@example.com