MasterCard has unveiled an updated EMV liability policy that, effective October 2016, shifts liability for ATM transactions.

In explaining the policy shift, MasterCard, in a statement, indicated that this move is part of the company's ongoing efforts to increase security by stimulating EMV adoption by merchants and through the financial services infrastructure.

“This continues our commitment to look holistically at the next generation of U.S. payments,” said Mike Weitzman, group executive, U.S. Markets, MasterCard, in the statement. “As other markets have migrated to EMV, we have seen fraud shift to the least secure channel. By establishing this liability shift, we're advancing efforts to prevent and reduce fraud.”

Weitzman also indicated that the timetable MasterCard has announced is intended to provide ample time for financial services operators to implement EMV.

In earlier announcements, MasterCard had set a 2013 deadline for EMV implementation for inter-regional Maestro ATM transactions.

“The program announced today expands liability for U.S. ATM operators to include all EMV-enabled cards used at U.S. ATMs,” said the company.

Sometimes referred to as chip and PIN, EMV is usually said to be a significant step up in terms of security over the mag stripes found on most credit and debit cards in the U.S.. It is more widely implemented in Europe, say industry experts, who also indicate that where it has been implemented, card-related fraud has diminished.

In its statement, MasterCard quoted Aite Group analyst Julie Conroy McNelley in supporting a security driven adoption of EMV.

“An upgrade of existing U.S. ATM systems to EMV is a necessary next step in the evolution of financial institutions' tactics to keep pace with fraudsters,” said McNelley. “The industry executives we talk to are bullish on EMV migration to reduce their potential vulnerability from mag stripe fraud and make way for future innovations that can help enhance the value of electronic payments to consumers.”

Instant Insights /

MasterCard Extends EMV Liability Policy to ATMs

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