The ATMInternational Association said last week's ruling against theFederal Reserve's debit interchange regulations could delayconverting ATM networks to handle debit cards embedded withchips.

U.S. District Court Judge Richard Leon's decision said DavidTente, executive director, USA for ATMIA, “could completely stallprogress toward development of the debit solutions necessary forthe vast US EMV migration. With one liability shift passed andothers looming in the near future, we're already seeing that thecourt's action has created a heightened level of confusion in theindustry.”

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The ATMIA said it now represents ATM deployers, manufacturersand networks in 60 countries.

The Leon decision is an ATM issue, the ATMIA said, primarilybecause so many ATM cards are also debit cards.

Most financial institutions, therefore, are holding back onchip-enabled debit card issuance until a solution is agreed uponthat not only meets regulatory requirements and the EMVspecifications, but also provides network-to-network portability,without the need for mass reissuing of cards at a later stage, theassociation explained.

“The simple reality of that interrelationship means that asolution for ATM owners, operators and users will not be possibleuntil all associated debit card issues are first resolved forretail merchants,” the ATMIA said, and that has largely frustratedATM industry executives.

“Our industry today finds itself dealing with a court decisionthat has just thrown away the rules upon which we have based all ofour work for the past year,” observed Tente. “Work that wasnecessary because the EMV spec being dictated by the global networks does not fitwell with the U.S. payment system as a whole. And meanwhile,the industry still faces the same unrealistic liability shifts.

“The need to rewrite rules, which has now arisen as a result ofthis latest court decision, will almost certainly delay deploymentof EMV debit solutions, pushing operators even further past thedeadlines and simultaneously increasing implementation costs andpotential fraud losses,“ the association complained.

“ATMIA is hopeful that global networks will finally come torealize that the current EMV migration roadmaps need some seriousreadjustment to fit broader industry needs,” Tente concluded.